Used Car Market Motorway Raised $ 190 Million In New Funding To Unicorn Appraisal as the used car market continues to explode.
The London-based firm’s latest round was led by Index Ventures and includes further investments from existing lenders Latitude, Unbound and BMW i Ventures.
The company received an initial investment from Shakil Khan, co-founder of Prima Materia and first investor in Spotify, and got a £ 48million round in June.
Autoroute, founded in 2017, operates a marketplace where car owners can upload their vehicles and car dealers can bid at a daily auction.
Semiconductor shortages and transportation issues
A tightening in the supply of semiconductors over the past year has triggered a shortage of new cars, suddenly pushing up the value of used cars. The average asking price for used cars has jumped 15.2% year-on-year.
It is also believed that the increase could be due to people’s concerns about the use of public transport during the pandemic.
“People aren’t very keen on buying new all the time, but rather sweating the asset and getting more value from it, from an environmental perspective.”
Motorway says it saw its sales increase 300% in the third quarter to $ 411 million from $ 105 million last year.
“The used car market has been very buoyant over the past three or four years,” said Tom Leathes, CEO of Motorway, said Sifted in June. Leathes said activity has increased over the past 12 months due to the pandemic.
Danny Rimer, an investor at Index, said the increase in demand was also due to consumer concerns about sustainability. “People are not very keen on buying new all the time, but rather sweating the asset and getting more value from it, from an environmental point of view,” he said. he declares.
A booming industry
Motorway is not the only European startup to benefit from the growing demand for used cars.
Auto1, a German used car dealership backed by SoftBank, launched earlier this year with a valuation of $ 2.2 billion. British startup Cazoo, which also runs a used car market and was at one time the UK’s fastest growing startup, rhavesed $ 900 million from a PSPC merger earlier this year.
“The used car market is the largest retail market in the UK – bigger than food value, at over £ 50 billion a year,” said Alex Chesterman, CEO of Cazoo. Said Tamisé in June.
Cazoo’s business model is different from that of Autoroute. The highway allows consumers to sell their own cars, using tools to help them photograph and upload their vehicles to the site, where dealerships then bid on them. Cazoo, meanwhile, gets its supplies from auctions and dealerships.
Freya Pratty is the reporter for Sifted. She tweets from @FPratty