The Rise and Fall of
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- Опубликовано: 20 окт 2024
- Go Mechanic raised $12 million at a $300 million valuation in 2019 and was set to secure more funding from SoftBank at a whooping 4X i.e. $1.2 billion.
But, things took a turn & the deal never went through.
Seriously, they had everything going for them - backed by Sequoia, rapid expansion, and a big brand - UNTIL investors got a hint of the shady picture and they had to lay off 70% of their workforce.
📺 Watch to know the full story!
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GoMechanic Crash Explained: History, Massive Growth, Steep Fall
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The simple solution is to get alignment with better long term VCs that do not have focus on vanity metrics but focus on value creation metrics.
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I lost complete trust in them when they quoted a 70k bill for my relatively new car. They are asking me literally change the entire suspension and brake systems. Their customer care turned to blind eye when I asked them to have another supervisor's opinion as the amount was very high. Finally, I decided to take my car out and have it serviced in the showroom. I have decided never to return and use any of their services in the future.
As someone who's used Gomechanic multiple times. It's the garage owners who were actually ripping off the company. They'd use inferior quality products during the service. Charge more than what the company claimed. And would update the company that the car has been serviced to claim their commissions before even servicing the car. It genuinely is a great alternative to crowded service centres. It's sad to see them go through issues.
Oh this one interesting Dhruv
Loved how you pateintly explained everything without rushing! Great work man!
As a car owner, I will expect proper care for car, like quality service, proper information distribution about car, quality garage, improvement of labour, the growth will be slow but definitely there would be a win.
Nice one Prateek sir. Honestly, we need more like Zerodha and Zoho, not like Paytm, Zomato, GoMechanic etc like overvalued and VC funded. Waise Amandeep looks good in Suite 😜
Paytm was a revolutionary product but UPI killed it.
The problem with the video is not calling a spade a spade. This is a clear case of financial fraud and it has not been called out and it maybe because he wants to maintain friendly relation with people in the industry for prospective future business opportunities.
You do realize pulling up zerodha and Zoho is so so so difficult..
Great content and perfect explanation. Keep doing this. Because content is the king.
Thank you Arul!
I feel the growth at all cost is dragging Indian startups. There might be huge credibility crisis in case of VC funding in times to come. I feel is already there...might just accentuate
Interesting take Dr Kumar, credibility crisis. Interesting :)
Very well explained
You people are damn underrated but soon you will reach millions 🔥💯
Thank you for your wishes! ❤️
@@PrateekSinghLearnApp you people worth it
As of April 2023, go mechanic was sold to life long group for about $30 mil (unconfirmed) in a slump sale.
Please don’t defend founders. Financial misappropriation amounts to cheating and has legal implications.
I agree we should have been more harsher on this video. Thanks for writing this, useful
The only problem with the video is not calling a spade a spade. This is a clear case of financial fraud and you have not called it that maybe because you have friendly relations or prospective professional relations with the party involved.
Thank you for this valuable lesson... it was so much fun to learn
Glad you enjoyed it!
Excellent analysis. Cudos
Thank you Dr Kumar :)
Same happened to OYO also right ? Quality got diluted...when they jump to high number of hotels.
Yes absolutely! Good catch
Hey what is the source of all the data in this video?
One should understand that, you cannot become rich overnight. It requires its own pace. The slower the growth the more stable it is. Any way this model is good and it avoids the pain of you searching for local garages and get your work done with trust. Any way their services are not that cheap, they garages and go-mechanic will put a bomb in your pocket if you do not have proper knowledge of cars and also the approx repair cost.
Makes sense
Good work
Thanks
They are not able to refund the undelivered product .
Something that could have done by the founders to save the employees.... NOT LIE
Yeah man!!
Honestly, There's a huge reason: The service Centers. Yu can't expect Indian Service centers to provide standardised Services. They have a poor and cheap mentality. The only solution for better services is: Owning our own centers to control price and quality.
Nice sir
Thank you for the excellent explanation - I am sure a lot of hard work goes into creating these videos - so Kudos to you and your wonderful team. There will be so many companies that will come and go - The founders of these companies need to understand that it's not just the idea but the execution of that idea consistently - Unless they have a proven system that has generated not only revenue and profits on a smaller scale its stupidity to anyone to believe it will do so when the company grows - looks like most of the time for VCs its a gamble rather than their love for the business. I belive the founders need to go back to the drawing board - relook at how they can turn this around by looking at where they messed up. Will be difficult fo sure to build trust now but if they believed in their idea and business they should not let it die.
Thank you Uday, Such a nice message so we’ll written. Look forward to more messages like this :)
L
1. Growth at all costs - does not apply to all sectors, as founders one should set realistic targets, KPIs = Be less greedy! Maruti is Maruti today coz of brand trust. 2. Through customer experience surveys - they should have checked on the satisfaction %. 3. Should have avoided financial gimmicks that would eventually be caught in DD. 4. Business model was well executed but it turned out to be not sustainable as QUALITY Assurance, and QMS was apparently missing.
Hey thanks for sharing Gaurav, do drop comments on the other videos we’ve uploaded
What did you mean when you said you burn money everytime you add a garage? Is this related to marketing or advertising or something else?
Growth hack to increase engagement on the video.
So adding a garage costs X but the costs 1.1x therefore there is a loss every time a garage is added. Yes this could be marketing and other service related costs too. Hope that answered the question.
@@PrateekSinghLearnApp but shouldn't that cost be linear. But the no. Of bookings received should grow higher than that right. Also, so you have breakup of revenue per garage and did it increase or decrease.
@@lganeshonly Really good point! When we scale exponentially the costs also go up exponentially. Then on the revenue side, since the company may have to grow very quickly it may add low quality garages where the revenue per garage is much lower than expected. This creates greater divides between money spent and earned. Hope that made sense :) thank you
Nice Dress-up Sir
Thankuuuu
My doubt is..there is one service of gomechanic...i.e..pickup the car from doorstep...and after serving they will give the car back to the owner .so my doubt .how the normal... consumer can give their car th the unknown guy...and..what is the guarantee..that the guy..will not stole the...car .how this..service can be executed...pls explain this service of go. Mechanic how are they executing this service
waiting n waiting Prateek
Just want to understand what is the purpose of this video, which is not in the stock market yet. we are aam admi,..not VC,..
It’s an attempt to help our audience get familiar with the private markets as well, because news only provides drama and less facts.
First of all very informative video I missed other expenses probably that was used for siphoning funds.
One thing you wrongly mentioned was funding of 850-900mn at val. of 1.2bn, no Softbank or tiger wasn't buying majority stake rather tiger agreed at 1bn valuation and Softbank agreed at 850-900mn at a combined funding amount of around 75mn. Founders were really pushing super hard for a higher valuation of 1.2bn probably because of the unicorn glow a startup gets, respect, access to more funds, enters the marquee club.
Also, I'll just put some part of the article posted by moneycontrol
GoMechanic was actively involved in talks with its existing investor, New York-based Tiger Global Management, which was planning to lead a $75-80 million round. While Tiger was ready to come in at a valuation of $1 billion, the company’s founders were pushing for a slightly higher valuation of about $1.2 billion.
“The founders of GoMechanic were adamant about the $1.2 billion valuation. They were negotiating hard for that valuation. While Tiger Global was offering them a valuation of $1 billion, they were pushing very hard for $1.2 billion,” a source in the know told Moneycontrol.
While the deliberations with Tiger Global were ongoing, GoMechanic was also talking to SoftBank, another prolific private market investor in India, to raise about $35 million from its Vision Fund. SoftBank, however, was willing to come in at a valuation of about $800-900 million.
i would suggest not to trust "go mechanic", they also jack up thier reviews on their website and also the mechanics who work with them are inexperienced and shady in nature to charge more money from the customer.
just asking around people and finding a suitable mechanic which works best for one is the best way to go