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The struggle of tech companies in 2022 is real, and used-car marketplaces have not been spared.
In 2020, many vehicle ecommerce startups in Southeast Asia and India drove their way into the unicorn club after raising large amounts of money. The Covid-19 pandemic contributed to their rise due to consumers’ fears of public transport.
But fast forward to 2022, with high inflation and an economic downturn, these companies are suddenly in the slow lane.
Because of thin margins and cash burn, growth has taken a backseat for now. Most of the used-car marketplaces are taking prudent measures to weather the storm.
In India, SoftBank-backed Cars24 let go of 600 employees earlier in May, while Droom postponed its IPO plans.
Recently, Malaysia’s Carsome announced that it was laying off 10% of staff as well as forgoing leadership pay for the rest of 2022. The company earlier this year raised US$290 million, which supposedly put it in a better cash position than its counterparts.
So what went happened with the Malaysian unicorn?
In the Big Story this week, my colleagues Putra and Emmanuel dig deeper into the financials of the company to answer that question.
Speaking of cost-cutting measures, Shopee has done a lot of those lately. Last week, its retrenchment extended to Malaysia, Taiwan, and the Philippines, where it also faced an unexpected social media backlash.
Our Hot Take attempts to explain when or whether we can expect an end in sight for Shopee’s string of bad news.
– Samreen
THE BIG STORY
Why did Carsome lay off 10% of staff? We dig into its finances for clues
THE HOT TAKE
NEWS YOU SHOULD KNOW
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