5:53 pm, June 23, 2020
Online car dealership Cazoo has been valued at £800m after yet another round of funding pumped £25m into the business.
Having been founded 18 months ago and only launched to the public six months ago, the dealer claims this is the fastest a British company has ever reached this value.
The company believes it is now a ‘unicorn’ business – a company with a $1bn valuation – however Cazoo are using American dollars to claim that title rather than pounds, despite being a British business.
The latest round of investment saw £25m pumped into the business from listed technology company backer Draper Esprit and takes the total raised by the online car retailer to £200m.
Cazoo was officially launched as an online used car retailing platform in December 2019 with £80m pre-launch backing and 1,500 cars in stock supplied by BCA.
Founder and chief executive of Cazoo Alex Chesterman said: ‘We have an amazing team who are dedicated to reinventing the used car buying experience by providing the best selection, value, quality, and convenience for UK car buyers.
‘Despite the current challenges many businesses are facing, Britain remains a market leader for talent and innovation and a great place to start a business.’
It is not known how many cars have been sold on the platform or how successful the business has been.
The amount of money the company has raised has been described as ‘eye-watering’ and many in the trade have questioned how it has achieved it and whether it is sustainable.
Earlier this month Cazoo also agreed a £10m a year sponsorship deal with Everton.
Mike Allen, head of research at Zeus Capital said: ‘It’s a big valuation and obviously they’ve got big ambitions. They’re building a brand very quickly. They’ve got a long way to go, but this is clear there’s a lot of intent there.
‘To achieve that valuation they’ll probably need more capital down the line, but they’re working with investors with a track record of achieving with similar tech companies.
‘With a valuation like that, they’ll need to deliver and successfully disrupt the industry. Whether they’ll manage to do it is another thing but this is a clear statement of intent.’
Cazoo faces fierce rivalry in the online used car trade with the soon-to-be-launched Carzam from Big Motoring World’s Peter Waddell.
Waddell, who has built a very successful used car business, has promised home deliveries of used cars on the same day buyers purchase. It is set to launch later this year.
Cazoo plans to sell 217,000 used cars a year investors pack reveals
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