Chester T. Dean 
Car sales website Carwow has secured around $55m (£42m) in new investment for its used car market as it seeks to take on rival Motorway.co.uk.
The company said it would use the money to expand its new Sell Your Car division, which has seen a business boom since its launch earlier this year.
Sell Your Car allows consumers to list their car by posting photos and details, and inviting dealers to bid and buy it directly from them, with all offers including collection fees.
Deal: Carwow’s Sell Your Car has helped sell £200m worth of cars so far
It has seen its revenue rise by 600% since its inception following the acquisition of Wizzle in June, having so far helped sell £200m worth of cars.
Chief executive James Hind, who founded Carwow in 2010 when he was just 23, said the new investment will help “energize” Sell Your Car, for which he has global aspirations.
“We are extremely pleased with how quickly our users and commercial buyers have embraced Sell Your Car, proving the value of a unified digital selling and buying experience,” he said.
In the three months to September, Sell Your Car hit its first goal of 7,000 live listings, with an average of 900 cars listed on the platform each day, the company said.
“This was all achieved so quickly by simply leveraging what already exists within carwow…We now plan to use some of the additional funding to advertise Sell Your Car to all car owners,” he added.
“With great results and learnings in the UK, we have started testing in Germany. Ultimately, our goals are global – just like the rest of the carwow business.
Sell Your Car competes with Motorway, which only last week achieved “unicorn” status – which refers to new tech companies valued at more than $1 billion.
The new investment from US venture capital firm Hercules Capital puts Carwow head-to-head with Motorway.co.uk, a leader in the online used-car market which only last week achieved ” unicorn”.
Unicorns are new tech companies valued at over $1 billion.
London-based Motorway saw its valuation breach that threshold after securing new funding worth $190 million from existing and new investors.
The highway model, on which Sell Your Car is based, helps customers sell their car to dealerships for free (dealers pay a fee) “in as little as 24 hours.”
Used car websites are taking advantage of a shortage of semiconductors that continues to limit production of new cars and drive up demand for used vehicles as prices continue to rise.
Used car prices are skyrocketing: the average used model costs £17,366, which is £3,862 more than a year ago. Large seven-seater MPVs, including the Seat Alhambra, Renault Grand Scenic and Ford S-Max, saw the biggest increases in value
Motorway reported a 300 per cent rise in third quarter sales to $411m (£311m), from $105m (£79m) last year.
The increase puts Motorway on track to achieve more than $2 billion in sales over the next year, the company said.
More than 100,000 used cars have been sold on Motorway since its launch in 2017, with a network of 4,000 car dealerships using the platform to bid directly on used vehicles.
Motorway claims to sell more than 8,000 cars a month, with a new sale being agreed every five minutes.
“That’s a big number, but still less than one per cent of used car sales in the UK – so there are huge opportunities ahead,” said Motorway chief executive Tom Leathes .
New funding from Index Ventures – which has backed companies like Deliveroo and Etsy – and Silicon Valley tech investor Iconiq Growth, among others, will help the company “scale even faster”, according to Leathes.
Motorway previously raised $67.7 million, with the latest investment bringing total funds raised to $273 million since it was founded by serial entrepreneurs Tom Leathes, Harry Jones and Alex Buttle in 2017.
With offices in London and Brighton, Motorway employs 250 people, more than half of them in technology, design or product development teams.
Carwow, which started life as a review aggregator, employs over 350 people in the UK, Germany and Spain, where it is a leading new car seller.
The latest investment follows a year of strong performance across the Carwow business, which saw revenue grow 60% year-on-year, despite challenges in the new car market.
“While this investment is focused on Sell Your Car, our rapidly growing team also delivered a banner year for our new automotive business,” Hind said.
“We led the market in the shift to electric vehicles, with over 30% of sales now fully electric, and we captured the huge consumer demand for the best way to get a new car and sell one. a senior.”
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