Wisedrive, a car extended warranty platform, has raised seed funding led by LC Nueva Investment Partners, through its early-stage venture capital fund, LC Nueva Alternative Investment Fund (AIF), according to ET report.
Spiral Ventures – an Asia-focused Japanese venture capital fund, Bhavadeep Reddy – angel investor and co-founder of HousingMan.com, and others also participated in the funding round, a company release said.
The startup will use the fund to expand its reach by partnering with used car dealers and authorised service centres for customers to maintain their cars and develop warranty tech to create trust in the used car industry.
Wisedrive’s extended warranty comes with free maintenance of used cars at manufacturer-authorised service centres and PAN India Road Side Assistance to customers at no additional cost to reduce the number of problems that are caused by the vehicle’s engine and transmission. In this manner, it makes it possible for customers to trust cars at offline car dealers and helps used car dealers to close transactions 60% faster than before, the startup said.
According to Kalyandhar Vinukonda, the founder and CEO of Wisedrive, in the past ten years India has witnessed a revolution in the discovery of used cars, but the next ten years will see a revolution in the building of trust in used cars. “Because there is a lack of transparency in the service history and the usage of the vehicle, the trust level of the buyer of a used car is significantly lower. Despite this, India sells 6 million used cars every year, a number that is growing at a compound annual growth rate (CAGR) of 15% year over year. There is a lack of trust, and we want to make up for it by establishing a relationship of trust with our customers. Thus we have partnered with offline service stations to provide customers with a streamlined experience and process whenever they bring their vehicles in for repairs or maintenance,” Vinukonda added.
“The country’s used car market saw an increase in organised and partially organised sales.. About 4.4 million used cars were sold in FY20, compared to 2.8 million new passenger cars. The Indian market, which is sensitive to price and mileage, should see an increase in demand. Going forward, we anticipate a significant increase in demand for the extended warranty that Wisedrive currently offers for this market segment. As a logical next step, we have identified Wisedrive as having the necessary approach in place to help used car owners have an extraordinary experience,” Ashish Chand, Founding Partner of LC Nueva, added.
Sujit Kunte, Head of India, Spiral Ventures, said, “Wisedrive’s pioneering extended warranty product solves the fundamental issue of trust in the purchase of used cars. We are excited to see the team, with entrepreneurial experience in the tech automotive sector, develop a data-driven approach to better price the warranty and manage risk. We are looking forward to supporting business development between Japanese corporations in the automotive ecosystem and Wisedrive.”
Ankul Maheshwari, Founder – CENSIE Capital Partners, said, “Extended warranty for used cars is a white space in India, despite having enough global examples nobody has been able to Indianize the solution to make it a win-win for buyer and seller both. Wisedrive was the part of ‘StellarStory 2.0′, a program launched by CENSIE that was the exclusive financial advisor for this transaction.”
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