motorway’s auction platform for second-hand cars raises $67.7m series b led by index ventures

Motorway Secures £48 Million in Series B Funding

Motorway, a U.K.-based startup, is revolutionizing the automotive sales landscape by facilitating auctions for privately owned vehicles to professional car dealers. The company has experienced significant growth by streamlining a traditionally complex process.

A recent Series B funding round, totaling £48 million (approximately $67.7 million), was led by Index Ventures. BMW i Ventures and Unbound joined as new investors, alongside participation from existing investors Latitude and Marchmont Ventures.

Platform Functionality and Benefits

Motorway enables car owners to potentially receive up to £1,000 more for their vehicles compared to alternative selling methods. This is achieved through a smartphone application that utilizes computer vision to evaluate the car’s condition.

Over 3,000 registered car dealers then participate in a daily online auction, bidding on the submitted vehicles. The highest bidder acquires the car and arranges for free collection within 24 hours.

Impressive Growth and Market Potential

Since its launch in 2017, Motorway has successfully sold 65,000 cars. May 2021 alone saw sales reach £50 million, equating to £2.5 million in daily transactions and over 4,000 completed sales monthly.

Currently, only 5% of all vehicle sales in the U.K. occur online, indicating substantial potential for market expansion and further growth.

Executive Insights

Tom Leathes, CEO of Motorway, stated: “For decades, outdated offline procedures have resulted in unfavorable outcomes and a poor experience for both sellers and dealers. Motorway has fundamentally transformed this flawed system into a superior online experience benefiting all parties.”

He continued, “Eliminating intermediaries provides a better deal for both the consumer and the dealer, all from the convenience of their homes and without the associated stress. Our rapid growth demonstrates our commitment to delivering increased value through technology, and this investment will fuel our continued advancement.”

Investor Perspective

Danny Rimer, a partner at Index Ventures, commented: “We consistently seek investments in companies that are genuinely disrupting industries and addressing genuine customer needs. Motorway exemplifies these qualities.

“The team has developed a remarkably robust platform, supported by advanced technology and a thorough understanding of the challenges faced by both consumers and car dealers. Motorway has rapidly become the preferred choice for a growing number of individuals selling their vehicles.”

Funding History and Future Outlook

To date, Motorway has raised £14 million in venture funding since its founding in 2017 by Tom Leathes, Harry Jones, and Alex Buttle.

Leathes noted that the COVID-19 pandemic accelerated the shift towards online car sales, prompting dealers to adapt their business practices and embrace digital channels.

Rimer highlighted the founders’ collective experience, stating that their prior successes and learnings reduce risk. He also emphasized Motorway’s marketplace model, similar to Farfetch, which avoids inventory ownership and focuses on facilitating transactions between buyers and sellers.

• Key Feature: Smartphone app with computer vision for car assessment.
• Auction Process: Daily online auctions with over 3,000 dealers.
• Sales Volume: 65,000 cars sold since 2017.