Chinese used car trading service platform "Chexiaoduo" recently raised $6 million in Series A funding led by Chinese electric vehicle (EV) maker Nio's venture capital arm Nio Capital and Li Xingxing, son of Li Shufu, founder of Chinese automaker Geely Group.
Older shareholders including China Growth Capital, Source Code Capital, and MSA Capital also participated in the investment.
Chexiaoduo was incubated by the used car fintech platform Che Duo Group, which was founded in 2018 by Zheng Wei, a serial entrepreneur in the used car space and graduate of Tsinghua University.
The headquarters of Chexiaoduo is located in Ningbo, Zhejiang, an eastern city in China, and the first intelligent used car hypermarket under the platform was opened there.
This is the second used car platform that Nio Capital has invested in recently, as it invested in used car dealer Uxin with Joy Capital last week.
Uxin said on June 15 that it had signed definitive agreements with Nio Capital and Joy Capital, with the two investors agreeing to invest a total of $315 million in it.
Uxin also reached an agreement with its convertible debenture holders, including 58.com, TPG and Warburg Pincus, to convert $69 million in aggregate principal amount of its convertible debentures into Uxin's Class A common stock.
More than 10 major investors, including Nio Capital, Joy Capital, and these convertible bondholders, agreed not to sell their holdings of Uxin's stock for the next nine months.
Nio launched its official used car business, Nio Certified, at the beginning of the year to provide high-quality services to used car users through self-operated business and has committed RMB 3 billion ($463.4 million) to the business over 5 years.
Nio has established a nationwide used car business network, providing the whole process of vehicle inspection, appraisal, acquisition, and sale.
Earlier today, a spokesman for China's Ministry of Commerce said that the consumption potential of used cars is huge and the country is working to promote the development of the used car market.
