Beepi expands to Phoenix – interview with CEO Alejandro Resnik
Buying or selling a used car is about as enjoyable as getting a tooth pulled. The process is such a hassle and can be so discouraging that many decide to just keep fixing their current vehicle. But it might be time to look again and find your next ride.
San-Francisco-based Beepi, a leading peer-to-peer marketplace that allows customers to seamlessly buy and sell their car from the comfort of their home, chose Phoenix as their first expansion city outside of California.
CEO Beepi Alejandro Resnik, set out to drastically change the way people buy and sell cars after his transaction with a car dealer went sour.
“I was a student at Massachusetts Institute of Technology (MIT) and my wife and I decided to buy a car so we could explore Massachusetts. As a student I didn’t have a lot of cash. We went to a dealership, and I got a Jeep Liberty, and two and a half days later the car caught on fire. I called the dealership and they didn’t acknowledge anything,” Resnik said.
The couple ended up suing the dealership and in the process “I learned about lemon laws and how unprotected consumers are when they have to buy a car. I thought, ‘there has to be a better way,’” Resnik said.
From that point Resnik wanted to build a company where customers can purchase and sell a vehicle with confidence and trust, get a money back guarantee and receive a fair price.
People give up on selling and purchasing a car because it’s such a headache, Resnik said. “When you make something really difficult, then people hold onto the assets longer than they should.”
Every car in their inventory is Beepi Certified which includes a 185 point inspection by professionally-trained mechanics (referred to as inspectors), and includes an AutoCheck car history report.
“Our inspectors are not random, not contractors, they are Beepi employees, certified and stockholders of the company,” Resnik said.
With used car transactions, it’s typically considered a final sale and bye bye. With Beepi, the buyer is given 10 days to test out their purchase (with a mileage limit); if they don’t like the car, they can return it for a full refund. There is no test driving of the car prior to purchase.
While Beepi is a licensed dealer in each state they operate, they don’t have overhead of a brick and mortal shop and can pass along the savings to the customers. Beepi makes their money on the spread between the buyer and seller price with no more than a nine percent cap.
If you are looking to sell that old Tahoe with 100,000 miles, this isn’t the platform. Beepi doesn’t sell cars older than six years or over 60,000 miles.
“We carefully select the best cars on the market and most of them don’t make it [to Beepi],” Resnik said.
Ready to sell or buy?
Once a seller lists the car on Beepi.com, they will receive a guaranteed price, which is at least $1,000 more than any offer you’ll get on the market, Resnik said. The price is calculated using Edmonds.com, other auto sources and their patent pending algorithm. The seller will schedule an inspection and upon approval, the car will be available for sale. The company guarantees that the car will be sold in 30 days or less or they will buy the car, Resnik said.
“It’s a better price than any other price that you’ll get. The seller has to do nothing, they get the guaranteed price and can relax,” Resnik said.
The buyer experience is just as simple. Once a car is purchased, in five days the vehicle will be delivered to the doorstep by an inspector, completely detailed, and with a big bow on it, said Resnik.
For both parties, Beepi will take care of all the paperwork and there are no nickel and dime negotiations, the price is the price.
“We do it instead of wasting your time with negotiations. We give you the best price up front,” Resnik states.
Beepi customers can buy cars on the platform from over 200 cities across the country. For buyers located in California and Arizona, the delivery is free. The cost for other states varies depending on location.
Expanding to Phoenix
Resnik said Phoenix was the first city outside of California and location was purely based on the demand from the customers.
“Thousands of people were writing to us to please come to Arizona. We deliver a lot of cars to Arizona; now Phoenix can take advantage of the free shipping, it doesn’t matter where the car is located,” Resnik said.
Since Beepi launched in April 2014, Resnik stated the company has realized a 56 percent per month growth over the previous month, and in Q1 hit $50 million in revenue with a projection of $100 million before the end of 2015.
In addition, Beepi has raised $79 million, the most recent being a $60 million Series B led by Foundation Capital and SherpaVentures who joined existing investors.
Resnik stated the raise “will be used for national expansion, with Phoenix as the first stop, and now we will be opening in a major city every month.”
Resnik couldn’t comment on how many jobs will be coming to Arizona, but did say that all inspectors will be locally sourced.
Next steps for Beepi include buying and selling cars through a mobile device and continuing to improve the customer experience.
“We are incredibly excited. [The expansion] marks a milestone for the life of the company and [Arizona] is a fantastic state; [there are] 3.2 million people in Phoenix that have been freed of the used car industry. I’m very happy for it,” Resnik stated.
Photos and graphics courtesy of Beepi.com