Second-hand car auction platform Motorway smashes Unicorn status after $190M raise with Index, ICONIQ
It was only in June that Motorway – a U.K. platform on which professional car dealers can bid in an auction for privately owned cars for sale – raised $67.7 million in a Series B round. It’s now raised a $190m Series C funding round led by Index Ventures and ICONIQ Growth, a leading Silicon Valley technology growth investment firm. Existing investors Latitude, Unbound, and BMW i Ventures also participated in the round. The startup is now claiming a valuation of over $1bn.
Part of the reason is the impact of the COVID pandemic on supply chains. Second-hand cars have boomed in price because new cars are being made in smaller numbers due to the lack of supply of computer chips and other essential equipment from China.
On Motorway consumers can sell their car via a smartphone app that also uses computer vision to assess the state of the car. The cars are then bid on by professional car dealers in a daily online auction, with the car collected for free by the winning dealer within 24 hours. Given it’s also a “contactless” process, dealers and car owners increasingly seeking to buy and sell cars online.
Motorway says it now has a network of 4,000 professional car dealers using the platform and claims it has booked a 300% uplift in third-quarter sales to $411 million compared with $105 million last year. Some 100,000 used cars have been sold on Motorway since launch, with over 8,000 cars currently being sold a month, with over $2bn projected completed sales over the next year.
Motorway is also announcing the appointment of James Wilson, former Director of Marketplace Fulfillment for Amazon UK, as Chief Operating Officer.
Tom Leathes, CEO of Motorway, said: “8,000 car sales a month are still less than one percent of UK used car sales – so there’s a massive opportunity ahead.”
Danny Rimer, Partner at Index Ventures, said: “Since joining the board, following our initial investment in June, I have experienced first-hand just how fast Motorway is growing and how agile the team is in scaling the business to support this incredible growth.”
Yoonkee Sull, Partner at ICONIQ Growth said: “The used car market’s move online is only accelerating and we believe Motorway is delivering the best consumer experience and the most differentiated supply to dealers in the UK.”
This latest investment brings Motorway’s all-time raise to $273m since it was founded by Leathes, Harry Jones and Alex Buttle in 2017.
In a call with me Leathes added: “There’s no connection with BMW particularly, but they are automotive specialists so they bring quite a lot of knowledge to the white broader market and trends that are happening. They were also part of the B along with Latitude and Unbound.”
“What motorway does differently to a lot of competitors is that we are we’re not a retailer. We don’t own inventory. We’re a marketplace. And so that that allows us to scale much more quickly,” he said.