In March, Cazoo abandoned its strategy of owning all its used car stock and switched to a marketplace model, similar to Autotrader.
Mr Chesterman also stepped down as chief executive last year, but stayed on as executive chairman.
Matt Mawhinney, joint administrator at Teneo, said Cazoo’s new marketplace model was “performing ahead of expectations”.
However, it has not been enough to sustain the company.
Teneo will now seek a buyer for Cazoo in an effort to safeguard its 200 jobs.
The company has attracted interest from possible suitors including German car giant BMW, as well as industry rivals Motorpoint, Car Gurus and Motors.co.uk, Sky News reported.
Earlier this week, Cazoo’s wholesale arm was sold to rival G3, while other assets including its vehicle fleet have been sold to Constellation Automotive, the parent company of Cinch.
Mr Mawhinney said: “Following Cazoo’s decision to pivot to a marketplace model, the group has been winding down its legacy operations and sold a substantial number of its businesses and assets.
“These sales have generated additional value for creditors, preserved a significant number of jobs, and ensured that leases have been transferred to new operators to mitigate losses to landlords.
“Following our appointment, we continue to progress discussions with a number of interested parties on the marketplace business and remaining customer collections centres.”