What's going on?

British used car retailer Cazoo agreed on Monday to publicly list shares in the US via an on-trend special-purpose acquisition vehicle (SPAC).

What does this mean?

Everything�s happening online nowadays � including car sales. Cazoo aims to provide a premium preowned purchasing experience: it buys up old cars, reconditions them, and then sells them on through its website. There�s doorstep delivery, and if you�re not satisfied then the company � unlike your standard sawdust-in-the-gearbox seller � simply picks the car back up. The approach seems to be catching on: Cazoo expects its sales to grow 300% this year.

Something similar’s happening to the company�s valuation, too. Cazoo�s agreement to merge with the Ajax I SPAC � an already-listed �blank-check� company whose sole aim is to merge with another firm � values the used car business at $7 billion: a nice bump from $2.6 billion at its last funding round in only October.

Why should I care?

For markets: Europe is more profitable, for a change.�

Cazoo�s US contemporary Carvana would probably prove stiff competition: its share price has increased fourfold in the past year, giving it a market value of just under $45 billion. But Cazoo reckons the European market is much more attractive than America anyway, with a higher population density setting it up for greater profitability. Eventually, that is: the company doesn�t expect to actually make any money until 2024.

The bigger picture: SPAC, USA, OMG.�

Europe�s $1 billion worth of SPAC listings over the past year is peanuts compared to the US�s $300 billion. That could be down to more favorable stock exchange rules � but Europe�s startups also tend to be twice the age of US equivalents when they make their stock market debuts. By that stage they�re often more profitable and likely less interested in handing over an up to 20% ownership stake to the SPAC�s sponsor.