Used Cars E-commerce Platform Vroom Inc. Files For IPO
New York-based used-car e-commerce platform, Vroom Inc., has confidentially filed for an initial public offering (IPO) paperwork, which is expected to stage in June, according to anonymous sources aware of the matter. This move will Tester the interest of the investors in the ice-cold tech IPO market.
After the Arizona-based online used car retailer platform, Carvana Co. has raised its shares seven-times since its 2017 IPO. Vroom has also drafted its paperwork to step on Carvana’s footprints, as in March, during the broader market’s selloff, Carvana has seen a fall of almost 80% of its shares. After filing IPO, it has recovered its trade near record levels.
In 2013, Kevin Westfall, Marshall Chesrown, and Scott Chesrown founded Vroom Inc., intending to establish an end-to-end e-commerce platform for offering a better way to buy and sell used vehicles. It has data-driven technology that brings all the aspects of the buying and selling process of the car to buyers anywhere they want. It is considered as the mini version of Amazon.com Inc.’s marketplace especially driven for used vehicles. eBay Motors and Autotrader.com Inc. are among its competitors.
According to Crunchbase, earlier filing IPO, Vroom has bagged $721.3 million in its 8 funding rounds. Durable Capital Partners, T. Rowe Price, L Catterton, AutoNation, General Catalyst, and Fraser McCombs Capital are among its prominent investors. According to its last Series H funding round held in December 2019, Vroom has secured $254 million and was valued at $1.5 billion.
According to the US-based industry market research firm, IBISWorld, Vroom is operating in an e-commerce market that touches a mark of $35 billion in size as per the prediction for 2020 and is expected to grow exponentially to 2025.
The most interesting part of the New York-based used car firm is that it is looking forward to its IPO filing in the course of the global emergency of the coronavirus pandemic. Although Vroom has not hit as hard as other firms like the US-based lodging platform, Airbnb Inc., which was planning to go public in 2020 but has delayed its plans. The employment rate of the US is now down by 14.7% i.e., the highest rate since the Great Depression, the severe worldwide economic depression occurred in the 1930s. Presently, as the economy is tattered, not a lot of people are interested in engaging their money in buying cars.