Cheyipai, a leading domestic second-hand car trading platform, announced on its microblog today that the company secured $50 million of capital injection led by Sequoia Capital and followed by Morningside Ventures, Matrix Partners, and CITIC Capital (source in Chinese). The fund will be used to optimize the user experience and establish service networks all over the country.
Founded in 2009, the company’s core technology is a normalized used car detection and valuation system 268V, which is developed by its cofounder Wang Tiezhong. The cars on the platform are sold to overall 163 cities countrywide.
Cheyipai charges used car valuation fees from sellers, and transaction-based and other commissions from buyers. A percentage of commissions will go to its 4S store partners.
There are around 100,000 used car dealers in China and Cheyipai has established cooperation with 6% of the total, according to Yang Xuejian, cofounder of the company (via Sina Tech). The company planned to partner up with 10% of the car dealers in 2014.
Chinese used cars are expected to near 10 million by 2014 and exceed 20 million by 2020, according to China Automation Dealers Association. More and more companies entered this market, like Youxinpai and KBB-like used car valuation service Gongpingjia.
image credit: Cheyipai