Cars24 To Invest $20 Mn In Early Stage AI Startups

IPO-bound used car marketplace Cars24 has committed $20 Mn (₹189.8 Cr) to its recently launched initiative, AI Labs, a dedicated initiative focused on building AI-first products. 

Cars24 Labs will be its “build, partner, and investment arm”, and the company said in a statement that this launch is its attempt to make India a place where frontier AI gets built, beyond consumption.

In a statement, Cars24 said that the initiative bids to take the AI operations in-house to external parties. With the initiative, it bids to help founders and builders leverage AI to further their entrepreneurial journeys. Via the new platform, Cars24 will also invest and incubate early-stage startups.

It has partnered with OpenAI, ElevenLabs, and AWS for the initiative.

AI Labs will focus on three key areas:

• Creating AI-native products and contributing to open-source innovation.
• Working closely with leading AI companies to accelerate adoption and experimentation.
• Providing capital and support to startups building category-defining AI businesses.

The investment plans of Cars24 are in line with its increased dependence on AI to sharpen its operations. The startup claims that AI has empowered it to reduce inspection timing, conduct audits at its retail hubs and handle 15 Lakh+ minutes of calls per month across 7 languages. 

However, the announcement also comes amid a major top-deck reshuffle within the startup. Over the past few months, Cars24’s cofounder and COO Mehul Agarwal, cofounder and CMO Gajendra Jangid and India used car business CEO Himanshu Ratnoo have exited the startup. The exits come amid the used car marketplace’s bid to undertake an IPO. 

In January, CEO Vikram Chopra shared the startup’s plans to go public by the end of the year. Without sharing details about the size of the public issue or the valuation, Chopra highlighted significant improvements in the startup’s financial health to support its bid to crack the $200 Bn used car market.

On the financial front, the startup’s adjusted net revenue in H1 FY26 rose 18% YoY to ₹651 Cr. The improvement in the top line helped the startup trim its adjusted EBITDA loss by 36% YoY to ₹162 Cr, Chopra claimed in a social media post in January.

Ahead of the public markets debut, Cars24 has been on an aggressive acquisition spree this year in the run up to the IPO, acquiring vehicle information and management platform CarInfo and automotive utility startup Vehicle Info in a bid to build a full-stack vehicle ownership platform. 

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