UK startup Hellocar, which specialised in selling cars online, has shut down.
According to TechCrunch, a spokesperson for the company confirmed the firm was ceasing operations.
The statement said: “We can confirm that Hellocar is closing. This was a bold, ambitious concept – the team sold cars, had no returns and received excellent customer reviews, but ultimately the model proved too complex to scale at this time. A significant amount of money will be protected and returned to Hellocar’s investors.”
Hellocar, a spin out of Founders Factory, made headlines in February after it raised £1m in funding. At the time, the firm said it would use the investment to launch operations in Manchester.
The round was led by JamJar investments and drew support from Alex Chesterman, founder and CEO of Zoopla Property Group.
Set up by Nic Carnell and Ben Smith, Hellocar was seeking to disrupt the UK’s used car market, reportedly worth £45bn by cutting out the dealer from the buying process.
Speaking earlier this year, Carnell said: “With trust in the used car industry even lower than estate agents and banks, it’s no surprise that four-out-of-five consumers still find the process of buying a car stressful.
“The majority of customers now conduct research online before visiting a forecourt and visits to dealerships have almost halved in just three years.
“Despite this, there’s been no notable innovation in the industry for years and the time is right to change that. We’re taking the process of buying a car from three months to three minutes,” he concluded.
Hellocar had partnered with the AA to provide inspections and a warranty.
It had also struck a partnership with Aviva to provide insurance.