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UK disruptors expect Cazoo to become a vehicle to shake up car sales

UK disruptors expect Cazoo to become a vehicle to shake up car sales

At the time Zoopla was launching its own website, Alex Chesterman promised that there would be no more start-ups.

The wife did not tell the children that they did not give them a second. He decided he would agree, giving the UK entrepreneur hundreds of millions of pounds after two successful but time-consuming businesses.

But that commitment was quickly broken. The 51-year-old Londoner has announced his intention to list his own this week two-year-old novice Cazoo car salesman In New York, with a valuation of $ 7 billion, using the special goals of billionaire investor Daniel Och.

The deal is still its largest, and the highest initial listing value of any UK company on the New York Stock Exchange. It will be the main test for Chesterman as he wants to grow the business quickly to justify the valuation that some believe is high enough in the UK technology market.

“It certainly seems like the wrong value now,” said a major VC investor, “the question is whether it will be in the future.”

But its history gives investors hope. For the self-confessed imitator of the ideas of others, Chesterman has managed to turn his frustrations with the markets that need to be shaken up into a fortune that will make a lasting impact on various UK consumers.

Lovefilm, a DVD rental service that sold 200 million euros in 2011 to Amazon in response to the UK’s Netflix, ended its high street video store.

Zoopla, which floated in 2014 and the property portal It was sold to Silver Lake in 2018 for $ 2.2 billion, Compensated by around £ 300 million, the British became obsessed with the values ​​of other people’s homes so that traditional real estate agents could cost them.

Cazook wants to do the same thing in the front yard of used car sales – making the process of buying a vehicle faster, lower cost, and taking your purchase home.

The deal will cost Chesterman, which owns a quarter of Cazoo, about 100 million euros in a similar amount in the company’s last private fundraiser last fall.

The three start-ups came from seeing the success of others in the U.S. — from a TV ad by U.S. car salesman Cazoo Carvana — but they shifted and shifted to the European market.

He describes the second engine as an advantage. . . we are the first in our market, but we let others know what works and what doesn’t ”.

Chesterman is often treated with suspicion by headlines – some sellers still have doubts about whether Cazook will make a profit. He admits that he will hardly know more about these markets, but he has seen that ignorance can be an advantage.

“Fixing broken things,” as he puts it. “I like watching movies, I live in a house, I drive a car. If you think about it as a consumer and you think there’s a way to improve that market, it’s likely that most consumers will feel the same way. “

Chesterman, who studied at St Paul’s School and then University College London, was offered a job at Goldman Sachs when a family friend offered to put him in the management program at Florida’s Hard Rock Cafe.

He planned to take a three-month sabbatical there, but eventually spent 10 years in the U.S., first running the Hard Rock branch and then the same friend when he started Planet Hollywood as one of his first employees.

The family’s emergency brought him back to London, and he initially wanted to pursue a career in hospitality with a bagel shop chain in 1999. Realizing that he deserved more for his real estate, he saw through DVD the opportunity in the mid-tech sector. home delivery.

Those who work with him say he can be emotionally deviant and obsessive with details. Others describe it as a creative deal to find the best time to build and sell businesses to smaller rivals.

“He’s not a flash guy,” said one person who worked closely with him, “and he does all the hours he was given; he could have retired years ago.”

Chesterman drives a Range Rover – when the time comes he says Cazooti will buy the next car – and lives in a house on London’s Highgate. He spends his money taking his family on vacation, though he has bought stakes as an angel investor in new companies such as Graze, CarWow and Farmdrop.

But at the moment Cazoo is dominant in his time, and he still believes it is his biggest option – he has announced it will be a 20 billion-euro business. He was floating in New York, saying he wants to take his business to investors who understand his business well, and that London does not want rapid growth, but rather the loss of starting new businesses. The number of list reforms mandated by the government would not change that.

“I think that’s the last one,” he said of his involvement with Cazoo, before adding, “But first I said they caught me.”

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