On a mission to help consumers with anything to do with their car, Europe’s leading online car buying and selling marketplace, carwow has ramped up $55 million to invest in its Sell Your Car service. The investment, comes in the form of venture debt from Hercules Capital, following a year of strong performance across the rest of the carwow business despite the challenges faced in the new car market, which saw revenues increase 60% year on year.
Following the last funding round in 2019 in which the London-based marketplace raised £25 million, this is the first time, the company has received backing from a US Venture Capital company. The new investment puts the company in a very strong position to compete with its rival Cazoo and Motorway, which acquired the unicorn status last week.
Big jump in last six months
Following six months of rapid growth since its launch in June 2021 following the acquisition of Wizzle in June 2021, the company’s Sell Your Car service has become one of the top sources of used car stock for the UK car trade. An average of 900 cars are listed on the platform each day.
How does Sell Your Car work?
The process is as simple as consumers listing their car by taking photos, and inviting dealers to bid and buy it directly from them, with all offers including collection. After ramping up monthly revenues for Sell Your Car by 600% since making the service available to its nine million existing UK users, the company is looking at investing in technology and platform development, international expansion and user growth.
After the London-headquartered startup founded by Alexandra Margolis, David Santoro and James Hind, proved its mettle in the home turf with Sell Your Car, it has now begun testing in Germany as it plans to go global. As it plans more growth across the continent, the company has already become the No1 for new cars in Europe, with over £4.2 billion cars sold in 2021 across the UK, Germany and Spain.
“With some fabulous results and learnings in the UK, the company has started its testing in Germany. Ultimately our aims are global – just like the rest of the business,” James Hind, carwow founder and CEO says.
Over 150 roles in the Sell Your Car division will be created over the next 12 months, adding to the existing team of 350. According to Hind, the positive response of the users and trade buyers proves the value of a unified, digital selling and buying experience. “Our platform has got a significant growth advantage owing to the size of our customer base and reach of our brand. This new funding is expected to facilitate our service and experience on all fronts.”
7,000 live listings in first 3 months
In just three months, the company hit its first target of 7,000 live listings and helped sell £200 million worth of cars in the first six months. “All this has been achieved so rapidly by just leveraging what already exists within carwow; our huge reach via content, our great relationship with dealers and our in-house technology. We now plan to use part of the additional funding to advertise Sell Your Car to all car owners,” he adds.
Steve Kuo, partner at Hercules Capital said “Whilst the focus of this investment is on Sell Your Car, our rapidly growing team also delivered a record year for our new car business. We’ve led the market on the switch to electric vehicles, with over 30% of sales now pure electric, and captured huge consumer demand for finding the best route for getting a new car and selling an old one.”