Sylndr, a company based in Cairo, has managed to secure a whopping $15.7 million in funding as it expands its operations beyond just online sales of used cars. The company is now venturing into auto financing, servicing, and offering tools for dealers in the industry. The round was led by Development Partners International’s Nclude Fund. This move comes as the company aims to tap into Egypt’s fast-growing vehicle market, which is currently under-digitized.
The latest funding round includes a mix of fresh equity and previously undisclosed seed financing. Sylndr has also secured close to $10 million in debt financing from local banks over the past year, bringing its total raised capital since its inception to over $30 million. In fact, the company raised a substantial $12.6 million in a pre-seed round back in 2022, which was the largest of its kind in Africa. The founder of Sylndr, Omar El Defrawy, who was previously an executive at a local food discovery platform called Elmenus, established the used cars platform in 2021. Initially, the focus was on purchasing used cars directly from consumers, refurbishing them, and selling them with a warranty and a money-back guarantee.
As the business evolved, Sylndr transformed into a comprehensive mobility platform that not only facilitates car sales but also offers digital auto loans, car servicing, and a marketplace for third-party dealers. El Defrawy explained in an interview with TechCrunch, “When we started the business, we were primarily focused on a consumer problem related to buying and selling cars. And when we started to scale that business, it became very clear to us that the market is much bigger than that, and creating value to customers would require us to build other compelling businesses that integrate with what we’re doing.”
Egypt’s vehicle market boasts over 6 million cars on the road, with a growing demand for used cars due to currency devaluation and escalating prices of new imports. In response to this, the government banned used car imports in 2021, shifting the market’s reliance to domestic inventory, which in turn drove prices to align with the exchange rate. Despite outnumbering new vehicles by three to one, used cars in Egypt are predominantly sold through unregulated dealerships or classified websites, leading to informal transactions and heightened risks for buyers.
Sylndr recognizes the opportunity in this chaotic market, estimating it to be a $10 billion industry. The company aims to streamline processes around inspections, standardized pricing, digital financing, and ensuring secure ownership transfers. The platform’s average sale price ranges between $20,000 and $25,000. El Defrawy noted that this figure has remained stable in dollar terms over the last three years, despite the significant depreciation of the Egyptian pound. This stability is attributed to how used car prices in Egypt are marketed similarly to imported new cars, which are pegged to the dollar.
The revenue and transaction volume of Sylndr were not disclosed, but the company reported a nearly tenfold increase in sales since 2022. In terms of revenue, there was a 22-fold rise in Egyptian pounds during that period, translating to a fivefold increase when adjusted for the dollar. The company’s expansion into three new verticals, including digital automotive financing, inspections, maintenance, and servicing, aims to reduce its reliance on inventory and capital. Sylndr has successfully integrated these services into a single mobile app, creating a convenient one-stop shop for buying, financing, and managing car ownership.
Furthermore, Sylndr’s revenue is now evenly split between direct-to-consumer sales and B2B transactions with dealers, with the newer financing and servicing verticals expected to contribute up to 60% of gross profit within two years. The company works with over 1,000 dealers nationwide, offering a comprehensive solution for buyers and dealers across the value chain. Despite the presence of other regional players, Sylndr believes its infrastructure of inspections, refurbishment, and bank partnerships sets it apart, making it challenging for competitors to replicate its model. Instead of expanding to the Gulf like other startups in Egypt, Sylndr plans to strengthen its position in Egypt, where it claims to be the leading used car trading company in terms of volume and value.
