Spinny Secures $160 Million Funding to Expand Its Reach by Acquiring GoMechanic
Spinny, a leading online marketplace for pre-owned vehicles in India, is gearing up for a significant expansion, with plans to raise approximately $160 million aimed at acquiring the car services platform GoMechanic. This pivotal move promises to bolster its market presence and operational capabilities.
A New Chapter in Spinny’s Journey
This upcoming Series G funding round, consisting of both primary and secondary investments, positions Spinny with a valuation nearing $1.8 billion post-funding. Several prominent insiders have revealed that nearly $90 million will be in the form of primary investments, with Accel contributing around $44 million. Details of this investment were made public via recent regulatory filings in India, first highlighted by Entrackr.
In addition to Accel’s participation, WestBridge Capital is committing a sum comparable to its previous investments in Spinny. Earlier this year, WestBridge infused between $35 million and $40 million during Spinny’s Series F fundraising round. Meanwhile, components of the secondary funding are expected to involve significant sales from the Indian venture capital firm, Fundamentum, alongside potential stake reductions from Blume Ventures.
Purpose of the New Fundraising
The fresh capital injection is primarily designated for the acquisition of GoMechanic, aimed at enhancing Spinny’s service offerings without tapping into its existing cash reserves. Earlier speculations suggest that Spinny is set to acquire GoMechanic in a deal valued at approximately ₹4.5 billion (around $49.7 million), integrating cash and stock options.
The acquisition of GoMechanic is particularly strategic given the recent tumultuous experiences of the startup. This company was earlier acquired by a consortium led by Lifelong Group after experiencing significant financial distress and admitting to inaccuracies in its financial documentation, despite having previously garnered attention from prominent investors like Sequoia Capital and SoftBank.
Strengthening the Value Chain
Incorporating GoMechanic into Spinny’s operations would significantly enhance its capabilities across the used car sector. Based out of Gurugram, Spinny sells around 13,000 pre-owned vehicles monthly through direct sales to consumers and dealers alike. The startup has established substantial reconditioning facilities for vehicles prior to sale and collaborates with third-party service shops for post-sale services— a gap that GoMechanic could effectively fill.
Moreover, GoMechanic will serve as a vital “two-way” funnel for Spinny. By providing servicing for cars bought and sold through Spinny, it could also attract new customers, increasing the supply of available vehicles while keeping customer acquisition costs low.
Market Trends and Future Prospects
The Indian market for used cars is on a growth trajectory, expected to reach approximately 9.5 million units by 2030, up from 6 million today, as reported by Mahindra First Choice and Volkswagen Pre-Owned Certified. The integration of GoMechanic aligns seamlessly with Spinny’s broader ambitions within the automotive market, which has also seen the startup diversify by acquiring leading auto publications such as Autocar India from the Haymarket media group and launching Spinny Capital to facilitate vehicle loans.
Spinny co-founder and CEO Niraj Singh has remained silent on public comments regarding these developments, but as the company embarks on this new venture, it stands ready to further define and reshape its role within India’s dynamic automotive landscape.