A potential winner during these times
Alex Chesterman is not a household name. Not like Bill Gates or LeBron James for that matter. But we would argue Alex Chesterman should be a household name as he has accomplished some impressive feats, namely founding one of the leading virtual car buying experiences we currently count on. Cazoo, Mr. Chesterman’s baby, is a used car buying and selling platform based out of the U.K. Like Vroom or Beepi, Cazoo buys used cars and the re-sells them online. They are delivered to your door and many times not even a handshake between humans has been exchanged.
As of September of last year Cazoo’s valuation was in the $220 million range. Growth has been swift and several analysts feel they might be approaching the mid $300 million mark by now. In a coronavirus world, not having human contact is welcomed, with open (virtual) arms! The spread of the virus has put a deep freeze on most in-person sales so anything that facilitates a purchase without having to infect your loved ones is certainly welcome.
Chesterman recently announced that Cazoo has successfully raised $116 million. Rather astonishing considering the times we’re living in. But even more astonishing was his follow-up – the intention of continuing to raise capital with the help of DMG Ventures, General Catalyst, Mubadala Capital, Octopus Ventures, Eight Roads Ventures and Stride. These venture capital firms are jumping in feet first, corona and all, to push Cazoo forward in a market that they feel will be mostly online for the remainder of this year.
Not a bad bet, considering most of us are in quarantine and buying a car in person is risky at best. Cazoo has a great FAQs section on its website that does a good job of assuaging potential clients’ fears of what it truly means to buy a car online, especially a used one. The company makes a point of saying that all their cars are fully reconditioned before selling (and ultimately delivering) them, and the process of doing so is done at a safe and hygienic distance. The U.K. numbers 8 million plus used car transactions per year so finding a more convenient way to do this is what Chesterman is after. We have a feeling Cazoo is going to be just fine over the coming months.