Autoquake secures another £6m investment from backers

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Autoquake, an online used car retailer in the UK, has raised another £6 million round of venture capital and venture debt financing from existing investors Accel Partners and Highland Capital Partners. The debt is being provided by Kreos Capital. This is after raising £4m from Accel and Highland only last year. That takes its total funding so far to £20 million.

Autoquake’s plan is to disrupt the car retail industry by selling quality used cars on behalf of large corporate fleets and leasing companies direct to consumers via virtual showrooms. High quality pictures of the actual cars on sale appear instead of the usual fuzzy pictures on the average second hand advert.

It’s main draw is that the average 10% discount is higher than most traditional dealers and car supermarkets and since modern cars tend to last much longer, second hand values are higher.

Total sales in 2009 were expected to exceed 15,000 cars. They are pushing at an open door. According to Capgemini 44% of consumers in 2009 were are likely or very likely to purchase a car on the internet if that functionality is available. Competitors in the US include CarZen, CarWale, Auto-IES.

Last year it lured Dermot Halpin, formerly President of Expedia in Europe, to become new CEO, relacing Garry Hobson.

  • Paul

    Mike – just had a look at the listed competitors. It seems that Auto-IES is actually a French Based company focusing on new cars : a different model.

  • Jonathan

    Can someone explain to me why such a nondescript site with very little in the form of innovation other than ‘having lots of decent photos’ has received such a huge amount of funding? What are they spending it on? Larger photos? More photos? The site only has a few hundred cars on it when there are several used car sites in the UK with 10s of thousands of cars, taking much more traffic.

  • Joao Belo

    At first glance I had no idea why VCs would be backing a used car business. Still, after better understanding Autoquake’s business model, it does seem to make some sense. I just wonder whether traditional used car websites can replicate some of Autoquake’s features and build on the customer base they already have. I’m no expert though…

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