London-based carwow secured a seed investment of £1.3m, a statement about the funding said.
Balderton Capital led the round for the online platform for purchasing new cars. Other investors participating in the round included Episode 1 Ventures, Samos Investments and angels Alex Chesterman, Simon Murdoch and Doug Monro. Balderton Capital's previous investments included Yoox, Betfair, LOVEFiLM and NaturalMotion. As part of the deal, Balderton Capital's Rob Moffat will be joining the Board of Directors at carwow.
Carwow Founder James Hind said in the statement, "We're delighted to have the backing of such experienced investors and are confident that this investment will help establish carwow as the best place to buy a new car in the growing UK market, and will also accelerate our international expansion plans."
The startup intends to remove the frustration that comes with purchasing a brand new vehicle. Even if this is the second largest acquisition for many people-the first being their home-it is one of the products where price transparency is nearly absent. Most buyers usually have to bargain with the car salesman in person and most don't relish the encounter, the statement said.
What carwow offers customers is the ability to compare offers from the comfort of their own home through the site and purchase the vehicle straight from trusted dealers at discounted prices, doing away with the need to haggle. Through the platform, users are able to "to build the car" they want to purchase and the dealers send in their offers. The customer can then do a side-by-side comparison of the offers in terms of price, location, reviews and stock availability, the statement said.
The customer is in control when using the platform because it is up to them to call the dealer if they like the offer. They can call up the dealer directly or can anonymously send them a message. Only the dealers that give their customers the best experience based on their previous response times and reviews are permitted to advertise their offers, the statement said.
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