MotorExchange, an online marketplace for used vehicles, has raised a second round of funding to expand its workforce and increase direct to consumer services. MotorExchange raised investments from Canaan Partners in 2009 and has now raised $5 million in a round, led by early stage investor Epiphany Ventures with participation from existing investor Canaan Partners.
If you look at the current exchange market, they are primarily dominated by company owned services, which have in a way lost consumer’s trust. And that’s where lies the opportunity for an independent party to build a certification process (another startup in this space is vericar) and ofcourse, the marketplace.
As far as business model is concerned, MotorExchange charges buyers a commission fee and provides the services to sellers for free.
Also, a growing segment that MotorExchange focuses on is repossessed vehicles from commercial banks (that come from loans defaulters). The site conducts open auction events around the same and like we said in the earlier coverage, MotorExchange brings a team of domain experts (pretty much everybody comes from automobile industry) who bring a lot of insights to the table.