GoMechanic Secures $6 Million Funding Amidst Financial Turnaround
- ByStartupStory | November 9, 2023
Gurugram-based car servicing startup GoMechanic has successfully raised $6 million in capital, marking a significant milestone in its financial recovery journey. This funding comes following a challenging period where the company’s founders acknowledged financial irregularities, leading to an insolvency process initiated by investors. In March of this year, Servizzy, a subsidiary of the Delhi-based Lifelong Group, acquired GoMechanic in a slump sale.
While the investor’s identity remains undisclosed, GoMechanic stated that the funding was secured from a marquee investor, a notable leader in the investment industry. The marquee investor led the funding round in collaboration with existing shareholders, including Stride Ventures and Lifelong Group.
Himanshu Arora, the new co-founder and CEO of GoMechanic, expressed confidence in the company’s business model, stating, “This achievement serves as a profound vote of confidence towards the company and in the potential of its business model from the investment community, the existing shareholders, Stride Ventures and Lifelong Group, and the startup community.”
Since the acquisition by Servizzy, GoMechanic has undergone a strategic shift focused on transparency, cost-effectiveness, and efficiency. Under the leadership of Muskan Kakkar, the COO and new co-founder, the company has expanded its business lines to include ‘GoMechanic Service Business,’ ‘GoMechanic Spares,’ and ‘GoMechanic Accessories.’ This approach has resulted in a fourfold increase in revenue, with positive projections for doubling revenues in ‘GoMechanic Spares’ and ‘GoMechanic Accessories’ by the end of the fiscal year.
GoMechanic Service, now handling 800 cars daily, has ventured into the luxury and premium services market with ‘GoMechanic LUXE.’ This specialized network serves luxury car brands like Audi, BMW, Mercedes, and Porsche, managing over 600 luxury cars monthly.
Kakkar emphasized GoMechanic’s commitment to revolutionizing the luxury car services industry, stating, “GoMechanic is revolutionizing the luxury car services industry by setting an unprecedented standard for personalized, high-quality, and convenient services.”
The company’s MILES membership program has experienced profitable growth, with a 72% increase in monthly membership sales in October 2023 compared to April 2023, indicating heightened customer engagement and loyalty.
GoMechanic Accessories has expanded its product offerings, including vacuum cleaners, Android car screens, and tyre inflators, available on popular e-commerce platforms like Amazon and Flipkart, enhancing accessibility for customers.
Previously recognized as India’s largest aftermarket automotive service and maintenance platform, GoMechanic faced challenges earlier this year, including accounting irregularities and lay-offs. Investors, including Sequoia and Tiger Global, were impacted. Despite the hurdles, the recent funding injection underscores GoMechanic’s determination to rebuild and strengthen its position in the market.
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The original GoMechanic firm, founded in 2016 by Kushal Karwa, Amit Bhasin, Rishabh Karwa, and Nitin Rana, is now poised for a turnaround with a renewed focus on customer loyalty and diversified service offerings.
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