E-commerce firm Alibaba led a $335m series E round for China-based online vehicle marketplace SouChe today that took the company’s overall funding to approximately $635m.
Private equity firm Warburg Pincus, investment firm Primavera Capital and CMB International, a subsidiary of financial services firm China Merchants Bank, also participated in the round.
Founded in 2012, SouChe operates an online automotive e-commerce platform that partners a network of more than 110,000 new and used vehicle dealers across China. It has some 330,000 monthly active users and expects to book about RMB150bn ($22.7bn) in transactions this year.
Alibaba’s contribution to the round made it SouChe’s largest investor, and its financial services affiliate, Ant Financial, already has several partnership initiatives in place with the company. They intend to jointly build a unified ecosystem that covers automotive production, distribution, consumption and services.
SouChe and Ant Financial co-developed a mobile vehicle purchasing platform called TanGeChe that connects car manufacturers, retailers and logistics, insurance and after-sale service providers. SouChe also plans to leverage Ant Financial to offer automotive financing to customers.
Ant Financial led SouChe’s $100m series C round in November 2016, investing alongside chauffeured driving service UCar, after Sequoia Capital, Morningside Ventures, Ferry Venture Capital and Yuan Du Ventures had already provided $20.4m in funding across two rounds.
The company raised $180m in an April 2017 series D round led by Warburg Pincus that included online lender CreditEase’s FinTech Investment Fund, Morningside, VMS Investment Group, ClearVue Partners, Zuoyu Capital, Haitong International and Cygnus Equity.
Junhong Yao, SouChe’s founder and CEO, said: “The value strategic investors such as Alibaba brings to the company is far beyond funding support. More importantly, SouChe will benefit from the investors’ cultural recognition, strategic collaboration, complementary resources as well as the shared vision for promoting the development of the industry.
“Based on the experience in Chinese automotive industry, we think that auto dealers will continuously play an important role in the business chain of the auto market, and it is crucial for them to upgrade internet capacities and improve services.”
Existing investor Cygnus Equity, which was formed by mutual fund manager China Post Fund, was SouChe’s financial advisor for the series E round.