Founder of Shopclues, Sandeep Aggarwal has launched his new marketplace called Droom to facilitate buying and selling of new and used automobiles. He has launched this platform with the view of building trust among buyers and sellers, while disrupting the current practice of buying and selling used vehicles online. To cater to authenticity, Droom offers algorithm of pricing, calculated seller score, transparency and health score of a vehicle, apart from just focusing on lead generation and listing of vehicles. Revealing his view of offering disrupting solution in the established ecosystem of online automobile, Sandeep Aggarwal, Founder, Shopclues and Droom spoke to Indianretailer.com
After Shopclues, did you ever think of launching online automobile platform for used vehicles?
I never thought of ending up in the automobile industry after Shopclues. I was more clinical in terms of deciding what I want to do as the first love (Shopclues) is always much more irrational and impulsive. I wanted to do two things differently from Shopclues, one is I did not want to be in fulfillment business like pack the car and deliver it and second is I wanted to be in the high gross margin business.
I wanted to make sure that I think of ideas before choosing one, so I came up with 52 different ideas but I ended up choosing Droom for selling used vehicles online because it has a big addressable opportunity.
The commercial operations of Droom started from January 2015 thus until September 2015 we were only available in NCR and now we are available in 122 cities across India.
It’s a bootstrap or funded venture?
I started Droom with the bootstrap funding. Then in the first round of funding I raised Rs 9cr from the first angel investor of Shopclues. In the second round of funding I raised Rs 20cr from the same investor and in the third round of I raised Rs 100 cr from other investor. In total I have raised $20mn so far. Investor’s stake in Droom is of 48 percent and remaining 52 percent is in-house.
Like Shopclues, how Droom is disruptive in the established ecosystem of online automobiles?
I could disrupt the market with Shoupclues while there were already the online market places existing like Flipkart. Similarly, if India didn’t have online classifieds like OLX and Quickr and discovery platforms like Cardekho and Carwale, then I won’t have been able to start Droom to capturing the end to end transaction platform. The important thing for me is to understand the ecosystem.
When we talk about the trust factor, we have Full Circle Trust score programme in which we take every listing into account with dozens of factor and give the score of one to ten to it. We have launched India’s first algorithm engine for used items called Orange Book Value with which we roughly confirm the value of the vehicle with using different parameters. Thus, we offer three types of pricing that is fix price, best offer price and auction price. On our platform seller can’t create listing unless they answer 43 questions, based on which we create full trust circle course. We also give pricing recommendation through orange book value. While buying the buyer has to pay two percent token amount online to Droom and remaining 98 percent to seller.
Also we offer automobile services such as inspection, roadside assistance, warranty, car care detailing, insurance, auto loan and rental service of plane, yacht and luxury car.
How many listings and sellers you have on board?
Droom is a four formats marketplace and its sellers are B2C, C2C, B2B or C2B. We have around 1,50,000 listings of used vehicles which includes bicycles, scooters, super bike, vintage bike, motocycles, car, vintage car, bus, truck, helicopter and planes everything which has wheel and motor used for transportation purpose. We have around 40,000 B2C sellers (dealers) across India and there are 65 percent listings of two wheelers, 30 percent is of cars and five percent is automobile services and rental. We allow five days to the consumer to meet the seller for test drive and he can pay through mobiquik, paytm, or PayU.
On an average it takes 12 days and 8 hours to sell a vehicle. Out largest selling format is B2C and until Diwali we will focus on B2C. We promote Droom through social media, paid search, organic search, email marketing, affiliate marketing, alliances and tv commecial,
What is your GMV revenue?
Our GMV revenue is Rs 700cr with around 2400 vehicles every month. Around 65 percent of GMV comes though cars and 25 percent through two wheelers. Our gross revenue will be of Rs 3000cr or higher by March 2017. We have mobile first approach.
In the last one year we have grown by 95 percent. By Q4 of calendar year of 2017 we will be fully profitable. Five years from now we are targeting to own 50 percent of every online transaction of automobile taking place in India and may be doing $6bn in GMV.
What are your expansion plans?
By 2017 we are planning to grow from 122 cities to 250. This year we are expanding to Singapore, Indonesia, Malaysia, Phillipines, Vietnam and Thailand.
We are planning to increase the number of listings from 1.5 lakh to 3 lakh. In terms of categories we want to expand into auto repair, insurance and auto loan in a big way. We are looking to acquire two or three companies for talent, pricing algorithms and company with the technology aggregate automobile services. This year we are planning to get into newer vehicles, so far our business comes from used automobiles and services. By the end of fiscal 2017-18 we are planning to list on Nasdaq while venturing into US and Europe market. We will be the technology and data science company launching more innovative products.