We know Carwow best for its YouTube drag races and its affable, everyman video host, Mat Watson. But those races are just a marketing trick to grow awareness of the firm’s European car sales business. And to help grow that business even further, Carwow has turned to crowdfunding to raise cash.
The company is offering people a stake in its business through Crowdcube and has so far raised almost £2.6 million ($3.2 m), blowing past its initial target of £1.4 million ($1.7 m). Investors can buy a sliver of the Carwow pie for just £10 ($12), but the company has some bonuses for those with deeper pockets. Hand over at least £2,500 ($3,100) and you’ll be invited to an evening soirée with host Mat Watson, while the largest single investor – expected to drop upwards of £150k ($185k) – will get to ride shotgun in an upcoming drag race.
We doubt that Warren Buffet would be seduced by silly sweeteners like that, but Watson has an absolutely huge following so we can imagine more than a few car enthusiasts might be prepared to hand over their cash without really considering if they’re making a sound financial investment. Maybe it is a good deal; I’m no financial expert so I’ll leave you to do your own due diligence. But I do know that while Carwow’s revenue is up and it claims to handle 10 percent of all UK new car sales, its losses more than doubled to £29.4 million ($36.3 m) in 2022 and this time last year it was forced to shed a fifth of its staff.
Related: Volvo Just Made Its Carwow Reviews Awkward After Buying Stake In British Company
Carwow makes its money by connecting buyers with dealers in a handful of European countries, charging the dealers a fee for sending enquiries their way, and it can also sell your car to dealers via online auctions. It’s already raised $157 million (£128 m) from venture capital investors plus automakers like Volvo and Mercedes, and in a previous round of crowdfunding back in 2019 hit its £2 million ($2.5 m) target in one hour.
Earlier this year another YouTube autos star, Doug DeMuro hit the headlines when he sold a stake in his Cars&Bids online used car auction platform for $37 million, though on that occasion members of the public weren’t given the opportunity to get in on the action. Have you put money into Carwow’s Crowdcube scheme or do you think it’s a bad deal? Drop a comment below and let us know.
