Published on November 16th, 2023 | by Daniel Sherman Fernandez0
Carsome Sacking Staff To Show Breakeven For Listing
Beep! Beep! The Carsome ship is sinking and job losses are confirmed
When a large ship is sinking, one way to stay afloat is to throw some passengers overboard to lighted the load. Its called collateral damage.
Interestingly this is exactly what Carsome is doing.
Meanwhile, when Carsome rescued two bankrupt automotive websites, (Wapcar and Carlist) the industry looked at it as a good move, however the reasons were simple, no other media were giving them much needed regular publicity to get their popularity up for a huge ‘unicorn’ listing in order for the initial team of investors to cash out on what we would like to call ‘one big market disrupter’.
Yes, they came into the used car market to ‘push’ small used car dealers into bankruptcy. Then they used their ‘fat wallets’ to close down competing automotive media websites with the promise of huge salaries and perks for the media staff.
Those (media staff) who joined the ‘Beep! Beep! Group are all now sitting and holding their heads in their hands and wondering how they are going to pay their rent, car installments and put food on the table.
Bloomberg has just reported that Carsome Group, which operates a Southeast Asian used-car online marketplace, is cutting hundreds of jobs to reduce costs as it works to reach profitability ahead of a potential stock-market listing.
The company is eliminating positions across Southeast Asia, with Indonesia and Thailand the hardest hit, people familiar with the matter said. Carsome has scaled down its operations significantly in those two markets, which it entered in 2017, the people said, asking not to be identified as the plans aren’t public.
Malaysia’s ‘so called’ most valuable technology start-up last year delayed its dual listing plans in Singapore and the US on concerns that deteriorating macroeconomic conditions could dent its valuation.
The company (claims) expects to break even this year and is set to achieve its first full year of profitability in 2024, CEO Eric Cheng said in July.
Carsome is preparing to be ready for an initial public offering (IPO), and when there is a window, the company can list quickly, he said at the time.
Carsome “makes adjustments to its workforce where necessary,” the company said in an emailed response to questions, declining to comment on specific numbers.
“We remain committed to investing in all of our current markets and plan to accelerate profitable growth in 2024,” it added.
Higher interest rates combined with slowing economic growth and geopolitical tensions have hurt market sentiment and weighed on first-time share sales.
Carsome raised USD290 million (RM1.36 billion) early last year at a valuation of USD1.7 billion in a series E round led by the Qatar Investment Authority as well as 65 Equity Partners and Seatown Private Capital Master Fund, both of which are backed by Singapore’s Temasek Holdings Pte Ltd.
Founded in 2015, Carsome has expanded into Indonesia, Thailand and Singapore. The company works with more than 13,000 dealers and sold more than 150,000 cars (some via auction at huge losses) last year, according to its website.