Carousell snags US$85m in new funding by investors including DBS

Singapore

CAROUSELL, Singapore's poster startup and online classifieds app, has raised US$85 million in Series C funding - a round The Business Times has learnt is entirely equity and does not include debt - with local lender DBS also joining as a new investor.

Industry players were quick to highlight that the funding amount - said to be the largest in the classifieds space regionally - is sizeable for a six-year-old startup that is loss-making and only in the last year implemented revenue models such as listing fees and advertising partnerships. But it is unsurprising given Carousell's reach, they added. Since its 2012 founding, the startup has now expanded to seven markets across Asia with over 144 million listings.

Hugh Mason, chief of corporate innovation firm JFDI, told BT: "The big digital businesses we know today are valuable because they engage large numbers of people regularly with their services. Carousell has that quality and my hunch is that its investors have backed the founders to achieve broad, deep user engagement rather than trying to milk out money now."

DBS, for instance, said that it will be collaborating with Carousell to offer financial products and payment services on Carousell's platform, and to connect to Carousell's community "both inside and outside of Singapore". While DBS did not disclose more details on the partnership, Carousell said it would be a "long collaborative relationship" and cited payments as a key focus.

Quek Siu Rui, co-founder and chief of Carousell, told BT: "Payments is one of our key priorities that is essential to driving our next phase of growth, along with improving trust, safety and fulfilment. We've been testing new features to address this, so we can build a system to inspire everyone in the world to start selling. Expect new offerings on the Carousell marketplace soon."

DBS group chief executive Piyush Gupta added that the bank has been leveraging digital technology and innovation to seamlessly integrate banking into the lives of customers. He said: "We're stepping up our participation in ecosystems, improving the customer journey and using data to inform our offerings. The investment in Carousell further builds on that."

MoneySmart, a Singapore-based personal finance comparison site, said that Carousell's latest funding will support the tie-up between both players. In March, MoneySmart announced a partnership with Carousell, under which Carousell users will be able to apply for MoneySmart-recommended financial products directly on the Carousell app.

Vinod Nair, chief of MoneySmart Group, said: "Carousell and MoneySmart have both committed substantial resources and are working closely together to creating a seamless experience on their platform - which I'm sure the funding will help support."

Asked why Carousell makes a good partner, he said: "Carousell is one of the most trafficked marketplace sites in Singapore. Their audience comprises a large number of working adults who have many upcoming financial decisions to make. By integrating with Carousell, MoneySmart can tap Carousell's massive reach to make personal finance products more accessible to their audience."

Carousell's Series C funding - which will be announced today - is being co-led by new investor EDBI, the investment arm of the Singapore Economic Development Board, and early investor Rakuten Ventures. It was participated by multiple investors including DBS, as well as existing investors such as 500 Startups, Golden Gate Ventures and Sequoia India.

Mr Quek said that the new capital will be used to cement Carousell's leadership in the classifieds space in South-east Asia. "We're actively looking to expand our expertise in the areas of data science, machine learning and many other emerging fields. We believe artificial intelligence (AI) will greatly improve the overall classifieds experience for our users."

He added that Carousell began to realise its AI vision in 2017, with the launch of predictive features like Smart Listings, personalised browsing and chatting experiences. Last year, the startup expanded its marketplace offerings in Singapore with high-value categories such as cars, property, jobs, services and finance.