Former Tech Darling Cazoo Crashes into Administration

Molly Monks - IP at Parker Walsh
May 24, 2024

Cazoo, the British online car retailer that was once valued at over £5bn, is set to enter administration on Tuesday. Insolvency practitioners are expected to be formally appointed, just over a week after Cazoo filed for temporary protection from creditors. The company, which made its debut on the New York Stock Exchange in 2021, has seen its fortunes dramatically decline.

The crisis at Cazoo has already resulted in more than 700 job losses, with administrators planning to retain some staff to continue operating the remaining marketplace model while they explore a potential sale. Industry sources suggest that entering administration will allow the administrators to focus on selling the company, as the marketplace model has attracted interest from several potential buyers. Potential suitors for Cazoo's marketplace and brand include BMW, Motorpoint, Car Gurus, and Motors.co.uk, a privately owned used-car platform.

Founded in 2018 by Alex Chesterman, the entrepreneur behind property portal Zoopla, Cazoo quickly rose to prominence, raising substantial funding at increasing valuations. When it listed on the stock exchange in 2021, investors valued the company at $8bn. Cazoo invested heavily in sponsorship deals across football, snooker, and darts to rapidly build its market share.

Recently, Cazoo has sold off several assets, including its vehicle fleet, which fetched higher-than-expected prices due to a current shortage of used cars. One industry insider noted that the shift to a platform model had increased Cazoo's inventory to over 15,000 cars, making it the only online vehicle marketplace where consumers can buy and sell cars under one brand.

Alex Chesterman departed the business several months ago following a restructuring that converted hundreds of millions of dollars of debt into equity. The move into administration follows another wave of restructuring aimed at stabilising the company's balance sheet and operations.

While Cazoo declined to comment on Tuesday, it stated last week: "Our new marketplace model, where consumers can both buy and sell cars, is revenue generating and performing ahead of expectations, with interest from nearly 100 car dealers, including many household names, wishing to trade on the Cazoo platform." The company added that it had "successfully restructured and significantly reduced the cash burn of the group."

As Cazoo faces the challenges of administration, the focus will be on the potential sale and the future of its innovative marketplace model, which has drawn significant interest from industry players.

Photo by Kelly

Molly Monks M.I.P.A
Licensed Insolvency Practitioner at Parker Walsh

I am Molly Monks, a licensed insolvency practitioner at Parker Walsh. I have over 20 years of experience helping directors with the financial struggles they may face. I understand that it can be overwhelming and stressful, so I offer practical straightforward advice, which is also free and confidential. I spend time with directors to get a good understanding of their business and their goals, therefore providing the best tailored advice possible.

Email: molly@parkerwalsh.co.uk

Phone: 0161 546 8143

WhatsApp: 07822 012199

If you have any questions about your business, we're always happy to help. Our advice is free and confidential.
Why Choose Parker Walsh?
Dedicated Insolvency Practioner
20+ years experience
Straight forward pricing
No referrals - all in-house
Fully regulated & insured
Contact Us

Related Articles

HMRC Loses Over £800 Million to Small-Business Phoenixing
HMRC lost around £836 million in 2022-23 due to small-business phoenixing, now accounting for one-fifth of its uncollected tax losses. Government bodies are tightening laws and enforcement to stop the abuse.
Firms Urge Government to Halt Tax Rises as Economy Stalls
UK GDP flatlined in July, raising fears of stagnation. Business leaders are urging the government to avoid further tax rises in the Autumn Budget and instead prioritise policies that encourage growth and investment.
Council Warns of Insolvency as Special Educational Needs and Disability Costs Spiral
BCP Council warns of technical insolvency as SEND costs soar, projecting a £171m shortfall by 2026. Without a long-term funding solution, essential services across the borough could face cuts.
Royal-Approved Maternity Brand Enters Administration Amid Economic Pressures
Royal-favourite maternity brand Seraphine has entered administration after struggling with sales and rising costs. Most staff face redundancy as administrators seek a buyer or prepare to liquidate the company’s assets.
WeightWatchers Files for Bankruptcy Amid Changing Weight Loss Trends – A Sign of a Wider Industry Shift
WeightWatchers’ bankruptcy highlights the growing impact of fat-loss injections—a shift that has also led to the liquidation of another long-established UK provider.
Article Categories
If you're worried about business debts, bills or cash-flow, we may be able to put a package together to help.
Call us today for a no obligation chat to see what options you have.
FREE IMPARTIAL ADVICE
0161 546 8143
Latest Articles
Why choose Parker Walsh?
We're one of the few companies who can handle your case entirely in-house
Many companies will take your case and pass it on to a licenced Insolvency Practitioner, like us.
Cut out the middle-man.
Our fees are clear, affordable and agreed up front, so there are no surprises.
Arrange a Call BackThe Insolvency Practitioners Association Logo
Case Studies
CONFIDENTIAL
All consultations are discreet and confidential.
NO ADVICE FEES
We don't charge for our advice. Our friendly team are available via phone or email.
NO REFERRALS
We don't pass on your details to another company. Everything is dealt with in-house

Send us a message

Thank you! Your submission has been received!
Oops! Something went wrong while submitting the form.
Prefer to WhatsApp? Send us a message and someone will get back to you as soon as possible!