In an all stock deal, MotorExchange, a company promoted by Vinay Sanghi, the former CEO of Mahindra First Choice, and former eBay India Head Rajan Mehra has acquired the business of B2C auto portal CarTradeIndia. The amount of the deal has not been disclosed.
Speaking to MediaNama, Sanghi said that “MotorExchange is targeting institutional sellers of used Vehicles, like banking and finance companies selling repossessed vehicles or corporates selling to business buyers. We believe that CartradeIndia has got a large consumer audience, which comes online to buy vehicles. It is more on the B2C and C2B side, and it completes the loop as far as MotorExchange is concerned. We’ve acquired it for the relationships, the technology and the traffic that the site has, and the team that exists.” There are around 15 people at CarTradeIndia. CarTrade India founder Akshay Shankar will join MotorExchange, run CarTradeIndia and help on the B2B platform, while his co-founder Nick Silderhuis is returning to Holland.
Sanghi declined to put a value on the deal, or comment on CarTradeIndia revenues, user database or traffic. We’re awaiting a response from Akshay Shankar, for some indication of what has been acquired, in terms of a user base, dealer network or revenues.
Update: Shankar declined to disclose the terms of the deal, CarTradeIndia revenues, or whether there’s a lock-in for him. He said that CarTradeIndia gets around 250,000 lakh visitors a month, and all this traffic is organic. The company has a dealer base of 2000. CarTradeIndia was a self-funded company, and they have the ambition to make it a larger copany. “We’ll get access to knowledge and expertise in the auto segment, which I think not many of the existing auto guys have. This will allow us to build more depth into our site, and give better value to our visitors,” Shankar said.
MotorExchange (the domain www.motorexchange.in has been booked by Sanghi) is expected to launch in the next month and a half or two. Motorexchange is currently internally funded, and Sanghi says they have not thought about raising money yet: currently they’re focused on getting the site up.
The business models for the two entities will be different: MotorExchange will have a transaction fee based model, while CarTradeIndia will have more of a listing model, and be advertising and lead generation based. There’s no exchange planned for CartradeIndia as of now.
Note that the MotoeExchange model is similar to that which Ebay has adopted in India for motors, though Sanghi suggests that MotorExchange will have a broader focus: “Ebay is mostly focused on banks, while we’re trying to be more broad based, fleet owners, leasing companies or even dealers who are stuck with inventory who want to auction it. Lots of dealers and banks don’t have an avenue to dispose inventory. ”
CarTradeIndia competes with large number of auto portals in India, including AutoIndia, Carwale.com (funded by Sierra Ventures and Seed Fund), Cartradeindia, Carazoo , CarSalesIndia, DriveInside, Gaadi (see disclosure below), IndiaAutomobile (Consim/Bharatmatrimony Group), Indimoto, among others.
Disclosure: I am related to Vivek Pahwa, whose company Accentium runs Gaadi.com