TrueCar

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TrueCar
TypeAutomotive Pricing and Information Website
IndustryAutomotive
Founded2005
Founder(s)Scott Painter, Founder &Chief Executive Officer
HeadquartersSanta Monica, California
Key people
ProductsPricing and information for new and used cars
Employees303
Websitehttp://www.truecar.com
 
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TrueCar
TypeAutomotive Pricing and Information Website
IndustryAutomotive
Founded2005
Founder(s)Scott Painter, Founder &Chief Executive Officer
HeadquartersSanta Monica, California
Key people
ProductsPricing and information for new and used cars
Employees303
Websitehttp://www.truecar.com

TrueCar, Inc. is an automotive pricing and information website for new and used car buyers and dealers. TrueCar is designed to provide a transparent car buying experience for auto dealers and consumers. In 2012, TrueCar was recognized as one of L.A. County’s 10 fastest growing private companies by the LA Business Journal, and named to Deloitte’s Technology Fast 500 for companies in North America.[1] News outlets, including CNN, Bloomberg, Newsweek, JD Power & Associates, Wall Street Journal, New York Times and U.S. News & World Report, have referenced TrueCar in reports and articles.[2][3][4][5][6][7]

TrueCar’s national network includes 7,000 automobile dealers across the United States, the company, headquartered in Santa Monica, California,[8] has helped its dealer-partners sell over 600,000 vehicles to date[9] and shoppers used TrueCar’s no-haggle pricing service in 2011 to buy 235,640 new and used vehicles.[10] It had a hand in 2 percent of sales in the nearly 13-million-car auto market in the U.S. in 2011[11] and the company claims it has saved people $1 billion so far, with the average consumer saving $4,154 off the car’s suggested retail price (MSRP).[11]

Early History[edit source | edit]

Before launching TrueCar, founder and Chief Executive Officer Scott Painter created several successful automotive ventures, including CarsDirect.com, and Zag.com.[12] Painter, along with co-founders Tom Taira, Bernie Brenner and Jim Nguyen, originally developed a business model through Zag.com, a leading online car-buying program, whereby dealerships paid a fee for each vehicle sold through Zag.com.[12] TrueCar enhanced Zag.com’s services by gathering data from multiple sources to compile new vehicle prices for consumers,[13][14] and by 2009, TrueCar had partnerships with several high-profile businesses and organizations, including Capital One Auto Finance and the American Automobile Association (AAA).[12]

Venture Capital Investments[edit source | edit]

In its 2008 Series A round of venture funding, TrueCar raised $2.8 million from Zag’s original investors.[13][15][16] It received $8.1 million in Series B investments from Capital One and Anthem Venture Partners[17] and TrueCar raised another $35.5 million in 2010.[15] In September 2011, TrueCar raised $200 million in funding from USAA, GRP Partners, Keating Capital, Silicon Valley Bank and Capricorn Investment Group.[15][18] As of 2012, TrueCar raised nearly $250 million in financing.[15]

Growth[edit source | edit]

TrueCar turned a profit in 2009.[18] In 2010, CNNMoney.com named TrueCar.com one of the “20 best web sites” to help individuals make better financial decisions.[19] The ranking was based on TrueCar’s ability to show car consumers what other car buyers paid for the same make and model in their area. CNN also highlighted TrueCar’s graphical representation of the data that consumers receive on its website.[19] Additionally, TrueCar ranked 11th on the L.A. Business (LAB) annual list of the 100 Fastest Growing Private Companies in Los Angeles,[20] and Inc. Magazine ranked TrueCar on its 2010 list of Fastest Growing Companies in America.[21]

In January 2011, TrueCar released ClearBook.com, the industry’s first used vehicle index that analyzes the entire used car market and shows how the market prices cars.[6] The website provides consumers with prices based on actual market data.[6][22]

After TrueCar raised $200 million in debt and equity financing in August 2011, it agreed to purchase ALG – a company that provides information on the future residual values of vehicles – for an estimated $83 million.[23] TrueCar later hired Larry Dominique, former vice president of product planning at Nissan, to run its ALG business and work with auto manufacturers.[24] Additional 2011 deals included the acquisition of News Corp-backed Honk.com in May and[25] the September purchase of CarPerks, an employee car-buying program operator.

In late 2011, TrueCar launched a television advertising campaign with commercials promoting its services.[26][27] Shortly thereafter, TrueCar faced backlash from the automotive industry[28] and several state agencies and regulators notified TrueCar that its practices could be noncompliant with some state laws.[29][30] In response to those notices, TrueCar worked closely with state regulators to overhaul its pricing structure.[26] It moved from a pay-per-sale model to a subscription model for dealers in some states.[31] It also hired industry veterans Pat Watson and Ken Potter to improve its relationships with automobile associations and dealers.[8] And to further strengthen its relationships with dealers, TrueCar formed a National Dealer Council,[32][33] with 20 members representing 281 franchise dealerships.[32]

Founder/CEO Painter ultimately restructured the business (in 2012) to focus on providing price transparency by tracking and publishing data based on actual car sales.[34] Additionally, TrueCar produced a new – much less controversial – advertising campaign[34] that kicked off in November.

Partnerships[edit source | edit]

TrueCar launched the world's first all-female racing team (in 2012) with support from Penske Media Corporation and Dragon Racing,[35][36] sponsoring women in six popular racing series, including IndyCar, Mazda MX-5 Cup, Star Mazda, USF2000, World Challenge and Rally America.[36][37] In June 2012, The Virgin Group announced its partnership in support of TrueCar's "Women Empowered" initiative.[35]

TrueCar manages auto-buying programs for major U.S. brands, including USAA, Consumer Reports, AAA, American Express and Pentagon Federal Credit Union.[38] TrueCar and Yahoo! formed a partnership in January 2012.[10] Under the deal, internet users searching for vehicles on yahoo.com were directed to TrueCar dealers.[10] The relationship became non-exclusive in July 2012.[10] TrueCar.com has rebuilt it (dealer) franchise roster to 5,200, including 35 of the 50 largest dealership groups nationally[10] and gets over 1,000,000 unique visits to its website each month.[39]

External links[edit source | edit]

References[edit source | edit]

  1. ^ "2012 Technology Fast 500 Rankings". Deloitte. 2012. Retrieved 17 November 2012. 
  2. ^ Alan Ohnsman; Makiko Kitamura (1 December 2009). "Hyundai Motors Leads U.S. November Vehicle Sales Gains". Bloomberg. Retrieved 17 November 2012. 
  3. ^ Peter Valdes-Dapena (25 September 2009). "Chrysler: Check Engine Now". CNNMoney. Retrieved 17 November 2012. 
  4. ^ Linda Stern (30 July 2009). "Is It Still a Good Time to Buy a Car?". The Daily Beast. Retrieved 17 November 2012. 
  5. ^ Amit Aggarwal (16 September 2009). "Vehix TrueCar Brings Greater Pricing Transparency to the Online Shopper". Online Automotive Review. Retrieved 17 November 2012. 
  6. ^ a b c Jennifer Saranow Schultz (15 February 2011). "ClearBook: A New Online Tool for Judging a Used Car's Worth". The New York Times. Retrieved 17 November 2012. 
  7. ^ Jamie Page Deaton (1 September 2009). "Cars with the Biggest Discounts". US News. Retrieved 17 November 2012. 
  8. ^ a b "Company Overview of TrueCar, Inc.". Bloomberg Businessweek. 2012. Retrieved 17 November 2012. 
  9. ^ "TrueCar, Inc.". PrivCo. Retrieved 17 November 2012. 
  10. ^ a b c d e Jason Stein (5 July 2012). "TrueCar, Yahoo End Exclusive Partnership". Automotive News. Retrieved 17 November 2012. 
  11. ^ a b Jim Motavalli (4 January 2012). "Guaranteed Low Prices! TrueCar's 'Transparency' Riles Dealers". Mother Nature Network. Retrieved 17 November 2012. 
  12. ^ a b c Harris, D (2006). "CarsDirect Founder Back, This Time to Aid Retailers". Automotive News. p. 6. 
  13. ^ a b "Zag Spins Out TrueCar". SocialTech.com. 10 September 2008. Retrieved 17 November 2012. 
  14. ^ Scott Painter, Mark Suster. This Week In Venture Capital #12 With Scott Painter (video). This WeekIn. 
  15. ^ a b c d "TrueCar". CrunchBase. 7 November 2012. Retrieved 17 November 2012. 
  16. ^ "TrueCar Obtains Series A Financing". Xconomy. 11 September 2008. Retrieved 17 November 2012. 
  17. ^ "TrueCar, Inc. Receives Series B Investment From Capitol One and Anthem Venture Partners". PrivCo. Retrieved 17 November 2012. 
  18. ^ a b Regina Sinsky (7 September 2011). "Vehicle Pricing Platform TrueCar Goes On a Spending Spree with $200M Funding". VentureBeat. Retrieved 17 November 2012. 
  19. ^ a b Lisa Gibbs; Joe Light and Ismat Sarah Mangla. "The 20 Best Money Web Sites". CNNMoney. Retrieved 17 November 2012. 
  20. ^ "Fastest Growing Companies in 2009". CBJ Online. Retrieved 17 November 2012. 
  21. ^ "TrueCar". Inc. 2011. Retrieved 17 November 2012. 
  22. ^ Shaun Conlin (26 October 2010). "TrueCar Announces ClearBook Used Car Pricing Aggregator". EverGeek. Retrieved 17 November 2012. 
  23. ^ Sawyers, Arlena (2011). "Painter's Vision: Sales with No Sales Staff". Automotive News. p. 8. 
  24. ^ Christie Schweinsburg (4 October 2011). "Product Planner Dominique Exits Nissan". WardsAuto. Retrieved 17 November 2012. 
  25. ^ Robin Wauters (3 May 2011). "TrueCar Acquires News Corp-Backed Automotive Social Network Honk.com". TechCrunch. Retrieved 17 November 2012. 
  26. ^ a b Tara Siegel Bernard (10 February 2012). "Car Dealers Wince at a Site to End Sales Haggling". New York Times. Retrieved 17 November 2012. 
  27. ^ http://www.youtube.com/watch?v=dv4vAPC4J4M. Retrieved 17 November 2012.  Missing or empty |title= (help)
  28. ^ "TrueCar Revamps Pricing Curve". F&I and Showroom. 6 September 2012. Retrieved 17 November 2012. 
  29. ^ "The TrueCar Challenge". Economist. 2012. p. 59. 
  30. ^ Doron Levin (18 January 2012). "TrueCar Is Running Into Roadblocks". CNNMoney. Retrieved 17 November 2012. 
  31. ^ "TrueCar Unveils Compliance Strategy". F&I and Showroom. 17 January 2012. Retrieved 17 November 2012. 
  32. ^ a b Ralph Paglia (6 August 2012). "TrueCar: Is It Time for Car Dealers to Reevaluate?". Automotive Digital Marketing. Retrieved 17 November 2012. 
  33. ^ "TrueCar Launches Dealer Councils". SocialTech.com. 2 April 2012. Retrieved 17 November 2012. 
  34. ^ a b Tricia Duryee (21 October 2012). "TrueCar CEO: Disrupting the Car-Buying Process Nearly Drove It Out of Business". All Things Digital. Retrieved 17 November 2012. 
  35. ^ a b "Virgin Group Aligns with TrueCar Racing's IndyCar Program, Women's Initiative". Auto Week. 13 June 2012. Retrieved 17 November 2012. 
  36. ^ a b Yvonne Wenger (1 September 2012). "All-women Team Leaves Mark on Grand Prix of Baltimore". The Baltimore Sun. Retrieved 17 November 2012. 
  37. ^ "TrueCar Racing". TrueCar. Retrieved 17 November 2012. 
  38. ^ "Know What Others Paid Before You Buy". TrueCar. Retrieved 17 November 2012. 
  39. ^ Faith Merino (6 June 2012). "How TrueCar Faced Down the Auto Industry and Rebounded". Vator News. Retrieved 17 November 2012.