Online car sales start-up Carzam has raised £112m in funding, accelerating business growth plans less than a year after its launch.

Founders Peter Waddell and John Bailey said a combination of astute sourcing, competitive pricing and a focus on the customer experience had contributed to Carzam’s early success

An unnamed US-registered global institutional investment management firm was the lead investor in Carzam’s first external fundraising round, which will be used to support technology and services that the firm said are needed to keep pace with consumer demand.

Launched in December 2020, the business is on track for 13,500 unit sales through the Carzam.co.uk website, bringing revenues close to £150m for its first year of trading.

Founders Peter Waddell and John Bailey said a combination of astute sourcing, competitive pricing and a focus on the customer experience had contributed to Carzam’s early success.

John Bailey, former president of Cox Automotive, said: “This is a pivotal moment in Carzam’s history. To attract investment at this scale just months after our launch is a huge achievement and is recognition of our rapid growth.”

Peter Waddell, an entrepreneur with a successful track record in the used car industry, added: “This is testament to our team’s efforts to establish Carzam, and to the strength of our customer proposition – we offer a simple way to buy the best quality used cars at competitive prices. It’s a model that makes sense to the consumer and that works for us as a business.”

Carzam sources high-quality used cars which are rigorously checked and readied for sale in its preparation centres. Cars can be delivered in as little as 24 hours from order, either to the customer’s home or to a Carzam collection centre, and can be returned within 14 days if the customer isn’t completely satisfied.

The business also boasts a management team filled with industry experts who bring with them a wealth of experience. Alongside the founders, the team  includes chief financial officer Michael Buxton, the former CEO and CFO at Cox Automotive UK, and chief marketing officer Ashley Wade, previously at Renault. And following Kirk O’Callaghan’s arrival as CEO from Sytner’s Carshop, James Buxton joined from Audi to become Carzam’s chief commercial officer.

CEO Kirk O’Callaghan will now lead the business through a period of rapid expansion.

He said: “Buyers are hungry for a hassle-free purchase at a fixed price, with excellent aftercare and a moneyback guarantee. People want to browse from home and make their own choice – they don’t want to be sold to.

“This new investment will facilitate Carzam’s bold plans and cement us as a true industry challenger, bringing quality used cars to the market faster, in better condition and in much greater volume.”