Renrenche, China’s third-largest used car platform by penetration rate, announced on Thursday it has closed a new round of financing worth US$300 million, piling up cash to contend against local rivals. The round is led by Goldman Sachs with participation from existing investors Tencent and Didi Chuxing.
Founded in 2014, Renrenche has amassed US$760 million in six rounds of financing according to data compiled by Chinese data service Jing Data. Initially focused on second-hand vehicle trading, Renrenche has tapped into financial services and is mulling to foray into the sales of new cars. In December 2017, it’s DAU was 21k, according to Chinese market intelligence firm Jiguang.
The relationship between Renrenche and Didi Chuxing has become increasingly closer since last September, when Didi Chuxing injected US$200 million strategic investment in the former company. Didi Chuxing then kicked off a new feature in its ride-hailing app for second-hand car sales, directing users to Renrenche’s marketplace. Earlier in March, the two companies decided to further nurture their relationship by cooperating in new car retail and offline businesses for vehicle maintenance.
Didi Chuxing is also reportedly planning to buy 1 million cars from the marketplace in the following 3 years.
Renrenche’s relationship with its another investor Tencent is way different. The social networking and gaming giant has invested in several other car marketplaces which are locking horns with Renrenche, namely Chehaoduo, Yixin and Uxin, the #1, #2 and #4 auto trading platform by market penetration rate according to data analysis platform Cheetah Data.
China was the world’s largest market for automobile in 2017, according to industry database Statista, with almost 25 million new cars registered. Another tech behemoth Alibaba is also weighing in the field, selling cars on its e-commerce platform Tmall as well as investing in Renrenche’s rival Souche.