Pre-owned two-wheeler financing startup WheelsEMI has raised Rs 100 crore in a Series B funding round led by Faering Capital. Existing investor Elevar also participated in the round.
WheelsEMI, focusing on used two-wheeler financing, was founded by former senior Bajaj Auto executives Srinivas Kantheti, Karunakaran Vadakkepat, CH Phaneendra Kumar and Ratheesh Bharathan in 2017.
With this investment Faering Capital, a mid-market-focused private equity (PE) firm founded by Aditya Parekh and Sameer Shroff, has made its fourth investment from the second fund.
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Faering Capital’s co-founder and managing director Aditya Parekh, who is the elder son of HDFC Group chairman Deepak Parekh told The Mint that while new two-wheelers are financed by banks, there is a lack of organized financing for pre-owned two-wheelers, a segment which WheelsEMI is targeting.
WheelEMI will use the capital to pursue growth plans, which will see the company expand its network to other cities.
There exists a sizeable low-income population that cannot afford new two-wheelers and consequently turn to pre-owned two-wheelers. However, formal financing is typically unavailable due to the informal nature of their income or the lack of credit history, and tend to approach local financiers who charge high interest rates.
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For the customer segment that WheelsEMI serves (includes students, drivers, carpenters, retail executives, low/middle income families and so on), increased mobility translates to wider employment options, higher earning potential, better education and a greater sense of empowerment. Several people are buying used two-wheelers to take up a delivery person’s job.
Srinivas Kantheti, Co-Founder and Managing Director, brings over 30 years of experience that includes 14 years of deep expertise in automotive sales and financing. Previously he played transformational leadership roles at Bajaj Auto, leading the company’s $2.5 billion Motorcycle division, the Auto Finance business and also as Head of Human Resources, driving organizational strategy and change.
Karunakaran Vadakkepat, Co-Founder and Joint Managing Director, played leadership roles in retail and channel financing in automotives and consumer durables – across Bajaj Auto Finance, ICICI Bank and Transamerica.
CH Phaneendra Kumar, Co-Founder and President (Sales & Marketing), brings deep expertise in rural channel development and has developed several innovations in two-wheeler financing processes.
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Ratheesh K. Bharathan, Co-Founder and Executive VP (Credit, Collections and Operations), brings over 20 years of experience across sales, credit, collections, branch operations and extensive experience in two-wheeler financing at Bajaj Finance.
Faering recently closed its second fund with a total corpus of $200 million (approximately Rs 1,400 crore). In 2009, Faering had raised Rs 800 crore for its first fund.
The firm has exited several of its investments from the first fund to return a significant amount of capital to its investors.
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