‘Car Vending Machines’ Startup Raised $160 Million
Three-year-old Carvana nabs new funds to expand its online used car marketplace. Phoenix-based Carvana, which debuted such machines last fall, said it has raised $160 million in new funding from unnamed investors. This brings the online used car marketplace’s total funding to $460 million.
Three-year-old Carvana is one of several companies that provide a white-glove approach to buying or selling used cars by making it easy to shop for, finance, purchase, and trade in a car. In addition to a 150-point inspection and 100-day, or 4,189-mile bumper-to-bumper warranty, Carvana says that its customers save an average of $1,681 on their purchase.
In November, the company opened its first “car vending machine” in Nashville, Tenn. where customers could go pick up their car in person. When they arrive at the five-story building, customers select their name at a kiosk, insert a Carvana-branded coin (a play on the “coin-operated vending machine” concept), and the car they’ve purchased is retrieved from the building.
Carvana says it had $150 million in revenue in 2015, and expects to make at least $350 million in revenue in 2016. While the company overall is not profitable, it says that several of its markets are.
Carvana is not the only online used car marketplace, competing with the likes of Beepi, Carlypso, Shift Technologies, and Vroom, among others.
The startup was founded in 2013 by Ernie Garcia and Ryan Keeton, and operates in 15 U.S. markets. – Fortune