Cazoo founder and CEO Alex Chesterman.
LONDON — Cazoo, a U.Ok.-based on-line market for purchasing used vehicles, has seen its valuation double to £2 billion ($2.6 billion) after elevating £240 million in a bumper spherical of funding.
Founded in 2018 by Alex Chesterman, creator of British property website Zoopla, Cazoo goals to fill an Amazon-shaped hole within the automotive trade. Online gross sales nonetheless account for a tiny slice of the general market globally however are on the rise as e-commerce has gotten a lift from the coronavirus pandemic.
The firm solely launched its e-commerce platform for used vehicles in December 2019 however has already seen revenues surge to £100 million, a spokesperson for the agency instructed CNBC. It’s now price greater than twice the $1 billion it was valued at in a June funding spherical, and has raised a complete of £450 million so far.
“Over the past few months we have seen an acceleration in the shift from offline to online car buying as U.K. consumers have continued to embrace our unique and market-leading proposition,” Chesterman, Cazoo’s CEO, stated in an announcement Thursday.
“This latest funding demonstrates the conviction of some of the world’s best investors in both our business model and team as well as the U.K. market and gives Cazoo the firepower to deliver on our plans to provide the best possible car buying experience for U.K. consumers.”
Overall auto gross sales have been below great stress this 12 months resulting from coronavirus lockdowns and their crippling impact on the worldwide economic system. According to IHS Markit, worldwide automobile gross sales are forecast to say no 22% this 12 months to 70.three million models.
Even within the used automotive phase gross sales have suffered. The U.Ok. used automotive market plunged round 49% within the second quarter to only over 1 million transactions because of the nation’s Covid-19 shutdown, in accordance with commerce physique SMMT.
Cazoo’s newest spherical was led by U.S. enterprise capital agency General Catalyst, American investor Dan Sundheim’s D1 Capital Partners and funds managed by Fidelity and BlackRock. Other backers embrace L Catterton, Durable Capital Partners and the Abu Dhabi sovereign wealth fund Mubadala. Cazoo stated it will spend the recent funds on hiring, advertising and marketing and product growth.