GoMechanic, a technology-enabled automobile car service and repair company, has raised $6 million in its latest fundraising round from a marquee investor and existing shareholders.
“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 start-up community. This exemplifies the company's unwavering and holistic growth and progress.” stated the new co-founder and CEO Himanshu Arora.
Investors in the car servicing startup GoMechanic, including Peak XV Partners (formerly Sequoia Capital India), Orios Venture Partners, and Chiratae Ventures, lodged a complaint with the Economic Offences Wing (EOW) in August 2023. They alleged the start-up's founders of financial mismanagement. This action comes seven months after the founders publicly acknowledged the financial misreporting in a LinkedIn post.
In response to this revelation, the investors had previously written off their investments in GoMechanic. Additionally, in May, the company underwent an acquisition led by a consortium headed by the auto component maker Lifelong Group through a slump sale. Notably, GoMechanic's competitor, Servizzy, is part of this consortium.
Post-acquisition, GoMechanic claims that it is attempting to create transparency and be more cost-effective and efficient. Under the leadership of Muskan Kakkar, COO and co-founder, it has expanded its business lines, including 'GoMechanic Service Business', 'GoMechanic Spares,' and 'GoMechanic Accessories’.
In a press statement, it said that it had experienced remarkable growth, with a fourfold increase in revenue. “This refined approach to business practices is positively influencing the company's performance, with projections indicating that ‘GoMechanic Spares’ and ‘GoMechanic Accessories’ will double their revenues by the end of this fiscal year, underscoring the robust potential within these specific areas,” it added.
GoMechanic Service now handles an influx of 800 cars per day. Furthermore, it has ventured into the luxury and premium services market with 'GoMechanic LUXE,' a network of luxury car service centers established across India that manage over 600 luxury cars monthly.
Its MILES membership program has seen profitable growth. Membership sales per month have increased by 72 per cent in October 2023 as compared to April 2023. This augmentation indicates a positive outcome where customers are now more actively involved and loyal to the brand or service.