Prime Venture Partners, 9Unicorns and Better Capital also participated in the round
Bengaluru, August 31st 2021: OTO, a two-wheeler buying and financing innovator, announced today that it has raised $6M in a Series A investment round led by Matrix Partners India. This also includes participation from existing and new investors such as Prime Venture Partners, 9Unicorns and Better Capital, as well as, marquee angel investors such as, Asish Mohapatra of OfBusiness, Ramakant Sharma of Livspace, Rangarajan Krishnan of Five Star Business Finance, Nitin Gupta of Uni, Kunal Shah, K Ganesh and Ashneer Grover & Suhail Sameer of BharatPe.
OTO will use this funding to scale its user base and to become the default app for two-wheeler buying & financing for 20M Indians who purchase two-wheelers every year.
OTO is currently present in 5 cities - Chennai, Bengaluru, Pune, Hyderabad, and Mysore. With this investment, the company plans to launch its financing-cum-commerce platform in 15 new cities including, Delhi, Nashik, Indore & Vijaywada. To drive this growth, OTO will double its team size by March 2022 and plans to hire aggressively across verticals, especially technology, product, marketing, and operations.
Commenting on this development, Sumit Chhazed, Co-founder, OTO Capital, said, “We are re-imagining the 2-wheeler buying and ownership experience for millions of Indians. Customers can research, schedule test drives at home, avail innovative & flexible financing options, and complete the purchase journey via our OTO platform. With electric 2-wheelers added to the mix, OTO aims to become the default app for Indian buyers to cut through the noise and get a 2-wheeler buying experience that has never existed before.”
Sanjay Swamy, Managing Partner, Prime Venture Partners said, “OTO is transforming the shopping, financing and ownership of two-wheelers, enabling OEM’s dealers and distributors to benefit from the consumer transition to eCommerce and self-service. We’re delighted to welcome Matrix Partners, BetterCapital and some amazing angels/entrepreneurs to join us in this exciting journey to transform this industry of 20 Million+ new vehicles, particularly as it transitions to connected Electric Vehicles in near future.”
Vikram Vaidyanathan, Managing Director, Matrix India, commented, “In the world’s largest 2-wheeler market (India), the consumer’s preference is changing – buying online, stretching their budget for quality and upgrading faster. OTO caters to this new consumer with a new model of buying, financing and ownership. We’re believers in the Financing + Commerce model and excited about the journey ahead for OTO. We’re privileged to back Sumit in this company and look forward to forging a great partnership with the team and outstanding investor group.”
Started in 2018, OTO operates on a simple financing model for 2-wheelers where the buyer pays an upfront amount like any other loan but gets up to 30% lower EMIs with an option to retain, return or upgrade at the end of the tenure.
The platform works in partnership with various banks and NBFCs to provide most hassle-free financing options to its customers. It also provides full auto lifecycle management, from credit underwriting to insurance, maintenance, and eventual resale of the vehicle.
Despite the Covid-19 pandemic, OTO has grown 4X in the last 12 months while maintaining less than 1 percent NPAs. More than 30 percent of company’s transactions were sourced and completed digitally. OTO’s robust growth and collection performance garnered strong interest post pandemic from various banks and NBFC’s and got it multiple lending partners with commitment of lending over INR 250Crs on OTO platform for the next 12months. OTO has also established successful partnerships with all major brands such as Hero Motocorp, Honda, Suzuki, Hero Electric, and more through their dealerships.
About OTO Capital:
OTO Capital was founded in 2018 by IIT-Mumbai alumnus Sumit Chhazed and Harsh Saruparia to present a 10X simpler, faster and more convenient way for 20Mn Indians to buy and finance their 2-wheelers every year. The company is headquartered in Bengaluru, with its services also available in Hyderabad, Chennai, Pune and Mysore. OTO has created a dramatically simpler leasing-like financing model for 2-wheeler purchases where buyers pay a similar upfront payment like any other loan, pay up to 30% lower EMIs and have the option to own the 2-wheeler at the tenure end OR sell it back to OTO. Around this core of “10X better” financing model & experience, OTO has added an app-based layer to help 2-wheeler buyers to find all the top options in one place, schedule a home test drive at their convenience and then choose to finance with OTO and continue to manage it - all in one place. With its 300+ dealer partners, OTO Capital has financed more than five thousand two-wheeler vehicles. Find more information about OTO capital on www.otocapital.in
About Matrix Partners India:
Matrix Partners India is an investment firm with approximately $1 billion under management. Founded in 2006, the firm invests in companies targeting the Indian consumer and enterprise market at the seed, early and early growth stages. Matrix India has invested in several market leading financial services companies, such as, Razorpay (payments and SME Neobank), OfBusiness (B2B Commerce, Fintech), Five Star Business Finance (SME lending), Mswipe (mobile POS), OneCard (mobile-first credit card), Jupiter (consumer Neobank), Ola Financial Services (digital-first fin. products), and LiquiLoans (P2P lending).
Other marquee investments include Ola (mobility), Dailyhunt (mobile local language platform), Ola Electric (electric vehicles), Stanza Living (tech enabled student housing platform), Country Delight (D2C dairy & fresh foods brand), DealShare (social commerce platform), Zupee (leading skill-based gaming app) and Bijnis (digital B2B marketplace) among others. Matrix India has advisory offices in Bangalore, Delhi and Mumbai. Matrix Partners has a global network of funds investing in the US, China and India, with approximately $5 billion under management. Further information is available at www.matrixpartners.in. To know more about our investment philosophy, check out the #MatrixMoments podcast series.