Increased interest rates may have put some strain on the auto lending sector. However, Indonesia-based Broom points out that these increased costs, together with other elements like the present market recession, have influenced customers to purchase used cars rather than brand-new ones.
Although Indonesia accounts for 30% of ASEAN’s new automobile sales, used car transactions there are six times higher than new car sales. According to Broom, this has caused a local used-car market worth $65 billion in the US.
A pre-series A fundraising round headed by Openspace recently saw the firm raise $10 million USD. Quona Capital, BRI Ventures, AC Ventures, and MUFG Innovation Partners all took part in the fundraising.
Broom has now secured a total of US $13 million in investment with the current round. Also, according to CEO and co-founder Pandu Adi Laras, it will acquire a US $12 million credit facility from DBS Indonesia and BRI in 2022.
Broom, which was established in 2021, offers its Buyback service to Indonesian used-car dealers in order to give them access to short-term operational liquidity. This enables merchants to raise funds by selling their inventory and repurchasing it later.
To assist dealers in increasing sales, Broom also provides a digital showroom management tool.
Broom has added more than 5,000 used vehicle dealers, created six locations, traded more than $300 million worth of inventory through Buyback, and increased its gross merchandise value by 16 times in the last year.
Broom will be able to broaden its product line and increase inventory turnover with the new cash. To support more dealers and handle a bigger transaction volume, the business also wants to expand its credit facility.
