Balderton Capital backs car-buying platform Carwow

Carwow, a UK-based online platform for buying new cars, has secured 4.6 million pounds in Series A funding. Balderton Capital led the round with participation from other investors that included Episode 1 Ventures and Samos Investments.


London, 15 December 2014: carwow, the biggest online platform for buying new cars in the UK, has raised £4.6 million in a Series-A funding round, led by Balderton Capital, Europe’s largest dedicated venture capital investors.

This follows an earlier fundraising round of £1.3 million in February this year, which was also led by Balderton Capital, the backer of successful companies including Betfair, LoveFilm, Nutmeg, The Hut Group and WorldStores.

Other venture capital investors who have participated in both of carwow’s funding rounds include Episode 1 Ventures (backers of Zoopla) and Samos Investments (backers of Ocado). James Hind, the 27-year-old CEO of carwow, said: “The seed round raised earlier this year allowed us to officially launch the website, expand the team rapidly, and grow to become the leading company in this space. This latest round will be used to expand the team further, roll out above-the-line advertising campaigns and start exploring new markets.”

Rob Moffat of Balderton Capital, who sits on carwow’s board, said: “James and the carwow team have made huge progress over the course of 2014. We were happy to be able to increase our investment given the high levels of inbound interest from other VCs. As carwow continues to improve the new car buying experience we believe it will become the default option for buyers.”

carwow enables consumers to compare new cars from multiple dealers in an easy-to-use online format. Prices and contact details for dealers are all provided. Consumers can then get in touch with their chosen dealer and buy direct without being subjected to undue pressure. carwow’s customers say they value the service because they don’t have to haggle, while dealershipsappreciate the fact that they are receiving well-qualified leads from people genuinely interested in buying.

carwow was set up in 2013 by James, after graduating in finance from the University ofNottingham, together with his co-founders Alexandra Margolis and David Santoro. James discovered, before founding carwow, that most car review sites were aimed at car enthusiasts, leaving an opportunity to create a simple, easy-to-use website for the average car buyer.

Having launched a review aggregator to help people choose new cars, James and his team realized that, having chosen a car, many people found the purchase itself a stressful experience.

Buying a new car is often a person’s second biggest purchase in life and is a process disliked by many consumers, as haggling is often face-to-face and, with little transparency in the market, consumers can often end up paying thousands of pounds more than they should.
James and his team believe carwow addresses these problems by making comparisons of new cars, specifications and prices much easier, while allowing customers to communicate clearly and simply with dealers. Once a customer has chosen their desired car, dealers get in touch to offer cars at various prices via the website, but the dealers are not given the customer’s direct contact details.

The first round of investment was used to expand the team, increase marketing spend and sign more partner deals. carwow is now the biggest online new car buying platform in the UK, having already driven more than £150m worth of sales for car dealerships and saving users a combined total of £15m. While the website features cars from £10,000 to over £100,000, the average carwow user spends £25,000 and will save, on average, £3,000 off RRP.

carwow is the beneficiary of both the recent recovery of the new car market in the UK and stronger consumer sentiment. The Society of Motor Manufacturers and Traders is predicting that new car sales for 2014 will hit 2.46 million, making this year potentially the biggest year for new car sales in a decade, with the predicted figure about 20,000 higher than the total in 2005.

About Balderton
Balderton Capital is one of the largest venture capital firms in Europe, committed to finding and helping talented entrepreneurs build great companies. Based in London, the firm manages $2.2 billion. Since 2000, Balderton has invested in over 100 companies, principally across Europe. Notable realized investments include NaturalMotion (the mobile gaming developer, sold to Zynga in 2014), Betfair (the online betting exchange, 2010 IPO), LOVEFiLM (the home entertainment subscription service, sold to Amazon in 2011), MySQL (the open-source database software, sold to Sun Microsystems in 2008) and YOOX Group (the online retailer of leading fashion brands, IPO in 2009).

The current portfolio includes innovative companies such as 3D Hubs, Globoforce, Kobalt, Nutmeg, Openet, Scytl, SketchFab, Talend, The Hut Group, Tictail, Wooga and WorldStores.

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About carwow
carwow officially launched in February 2014 and offers users the best experience throughout the entire new car buying process, guiding them seamlessly from research to purchase. Ultimately, carwow users end up with the right car at a great price from a great dealer.

The site was founded by James Hind, a 27 year old entrepreneur from the Wirral. carwow is based in Holborn, London and is run by a young team of twenty people.