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Facebook Investor Accel To Invest In CarWow

An early investor in Facebook (NasdaqGS: FB - news) is poised to invest millions of pounds in CarWow, a UK-based online dealer which has been described as the Expedia (NasdaqGS: EXPE - news) for new vehicles.

Sky News has learnt that Accel Partners, the Silicon Valley firm, is in detailed talks about injecting between £10m and £20m in CarWow, which launched in 2010 as an online car aggregator, according to people close to the situation.

The valuation that such an investment would place on CarWow was unclear on Thursday.

The site promises to turn on its head the traditional method of buying a car at a dealership, by allowing drivers to choose the car they want and then inviting local and national dealers to make the most attractive offer.

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CarWow was set up by founders including James Hind, and has already raised funds from a number of well-known investors such as Balderton Capital, Episode1 Ventures and Alex Chesterman, founder of the online property portal Zoopla.

If completed, Accel's investment would be another high-profile step for CarWow, which employs more than 35 people.

Accel's initial $12m stake in Facebook eventually turned into one of the most lucrative technology company investments in history.

It (Other OTC: ITGL - news) has also owned shareholdings in companies such as Dropbox and Flipkart.

The new capital would enable CarWow to accelerate its expansion both in the UK and internationally.

While the number of new UK car registrations fell in October - with brands owned by Volkswagen (Other OTC: VLKAF - news) particularly affected in the wake of the German car-maker's emissions scandal - the industry is on track to meet a strong full-year growth forecast set by the Society of Motor Manufacturers and Traders.

That growth should present an opportunity for digital groups which are emerging as potential rivals to traditional dealers.

However, a number of prominent online launches have failed to gain traction since the original dotcom boom, with many consumers keen to visit a dealer so that they can purchase a car in the traditional way.

An Accel spokeswoman said it did not comment on "rumour and speculation".