Digital Social Hour - Making Millions off Flipping Cars I Jared Wheeler DSH #359

Episode Date: March 18, 2024

Jared Wheeler comes on the show to talk about cars and making millions. APPLY TO BE ON THE PODCAST: https://forms.gle/qXvENTeurx7Xn8Ci9 BUSINESS INQUIRIES/SPONSORS: [e-mail] SPONSORS: Opus Pro: https://www.opus.pro/?via=DSH Deposyt Payment Processing: https://www.deposyt.com/seankelly Factor: https://www.factor75.com/dsh50 LISTEN ON: Apple Podcasts: https://podcasts.apple.com/us/podcast... Spotify: https://open.spotify.com/show/5Jn7LXa... Sean Kelly Instagram: @seanmikekelly   Digital Social Hour works with participants in sponsored media and stays compliant with Federal Communications Commission (FCC) regulations regarding sponsored media. #ad Learn more about your ad choices. Visit megaphone.fm/adchoices Learn more about your ad choices. Visit podcastchoices.com/adchoices

I probably wouldn't have if I wasn't as young and dumb as I was. Because it's a lot more difficult than you realize as you start scaling. Did you need a lot of capital to start one? No, that's what I mean. I was lucky. I only had $30,000 to start. And you could go buy 10 good cars with that and flip them. It worked out pretty well.

If I had to restart now, you'd need a lot more capital probably to do what I did in the beginning. Wherever you guys are watching this show, I would truly appreciate it if you follow or subscribe. It helps a lot with the algorithm. It helps us get bigger and better guests, and it helps us grow the team. Truly means a lot. Thank you guys for supporting, and here's the episode. All right, guys, we are back. Digital Social Hour. We're going to learn about cars today, aren't we? I hope so. We'll see what I know. Let's do it. Jared Wheeler, man. How long have you been in the car space? Since I was 18. So I guess I should say I started my dealership when I was 18. I was working in car dealerships when I was 14 detailing. So a long time.

Starting a dealership at 18. I mean, that's super young. Well, yeah. So it was 2009 2009 so like it was right after the crash so it's kind of an interesting time to get into it honestly if if you think about it's like the best time to try and learn you could buy some pretty nice cars for a thousand bucks back then so i think i got kind of lucky on when i started it maybe if i uh probably wouldn't have if i wasn't as young and dumb as i was yeah it's a lot more difficult than you realize as you start scaling. Did you need a lot of capital to start one coast? No, that's what I mean.

Like I was lucky. I only had 30,000 to start and you could go buy 10 good cars with that and flip them. It worked out pretty well. If I had to like restart now, you'd need a lot more capital probably to do what I did in the beginning. It's still kind of easy to get into the flipping space. I help a lot of people flip cars and learn how to do that. But back then, yeah, it was almost more dangerous to be in the normal car industry where you're trying to buy $20,000 to $30,000 cars, right? Because you could just lose so much more money when the economy was poor.

Right. And when you get to like $1,000 to $3,000, it's hard to go much lower than that. Less risk. Yeah. And you quickly became the largest independent dealer in your area. Which area was this? So I live in Southern Utah, St. George, Utah. Yep.

It was an interesting market. That in particular was an interesting market. When I got into the scene, I would say the normal way to market cars was in the newspaper. Like you'd have ads like with little old school print ads of, hey, this is $16.99 or whatever, you know. And then no one was doing anything on the Internet when I first got into it. So I kind of started and really did something no one else was doing yet in my market, which is so done now, right? Putting cars online or listing them on Craigslist or KSL in the early days really kind of got me ahead in the timing.

So a mixture of timing and just being early to different marketing platforms. Yeah, I think that with dealers, they're really keen on, they call them dealer 20 groups where you'll go meet with other dealers that aren't in your market. That's what they call it, right? And you're supposed to share ideas and all this stuff. I've never gone to a dealer 20 group. I've never looked at or got any feedback from anybody. And I think that kind of helped.

I think it was nice to not know anything about how the industry worked. And it kind of made it so you could be a little more innovative on how you think it should be instead of, Hey, this is what everyone does. So I was kind of the first to pioneer just putting the lowest price up front, which is kind of like a duh thing. Now, a lot of people do it. A lot of dealers that are successful do it now, but it used to be, you buy a car, it books for 10 grand, you put it up for 10 and you got to go negotiate with the customer. And it was this whole back and forth thing. And so I quickly shifted to, well, everybody else is asking $10,000.

Let's just find what the lowest price is online and let's place it there and just turn inventory fast. So that's kind of how it scaled so quickly, I guess, in the grand scheme of things. I just was able to sell more. So you played the volume game. Instead of focusing on margins, you focused on volume, building that customer base. Right. And then it shifted. As you do volume, everything starts changing, right? You start getting better deals when you're buying parts.

You get better deals at the auctions you deal with. You get all sorts of incentives coming back to you. And then it kind of started shifting to back-end products became a really big thing for dealers, right? And now they're a lot more prevalent and people kind of demand them. Service contracts or all that stuff. Yeah. Curious about the auctions. Walk me through what goes down there. Are you allowed to bring your phone to look up pricing or do you have to know everything? Oh yeah, yeah, yeah. So it's pretty, so I actually do the auction a lot different than most dealers. I kind of was the first in the beta testing of online auctions. So it's pretty. So I actually do the auction a lot different than most dealers.

I kind of was the first in the beta testing of online auctions. So they came to me to do that. And I've been doing that for a long time. Kind of forced a lot of dealers to learn how to just buy online. So I just have all my screens. It's almost impossible. Do you guys spend a lot of time or money or both on food, especially cooking and ordering delivery? Well, look no further than Factor, guys.

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DSH50 at factormeals.com slash DSH50. To buy as many cars as we need to if you're in lane. So how the auction looks is you literally have 13 lanes of cars that are just driving through with an auctioneer at each one, and there's a floor guy that helps. Wow. But if you had to buy as many cars as I do in person, it's impossible to run to each lane. So it's better to have them up all digitally, and you just can click as fast as you want. Do you literally have 13 screens? No, I don't have 13 screens. it's impossible to run to each lane. So it's better to have them up all digitally and you just can click as fast as you want. Do you literally have 13 screens?

No, I don't have 13 screens. There's 13 lanes open and I can fit six on each. So normally it's three screens and some of them I'll avoid some lanes that I don't like. If I don't like the sellers or if they sell bad product, then I avoid those. But yeah, it's almost all digital. But the old school way is exactly how you think. And it's not, I shouldn't say old school. People still do it every day.

But you go there and you can have a little app on your phone that scans it and tells you what the values are and stuff. Interesting. Wow. And how many are you buying? Because you're saying you're buying a ton. Yeah. So I actually have it pretty down to a science where I know exactly how many cars we need to buy depending on what the market trend does. So like I was saying, it's all about velocity for me. So I like keeping it at a 45-day turn.

A normal dealer tries to be at a 60-day turn, which means you're turning your inventory twice a year, right? So I'm a little ahead of that. But if I get too low, if I buy too many cars and we sell too many, then you almost get bottlenecks and all these different things. Because you have to remember, I got to buy it, I got to transport it, I got to get it back to my dealership where we have our service center, service them all. So depending on your flow, it's better to just know, okay, we sold this many cars last week, we need to replace this many. This many trade-ins. Okay, so we need 27 cars this week or whatever. Interesting. And how many are you selling online versus in person? So the dealership is basically online,

but it's all about setting people up to come in is the normal way, right? This is how my traditional thing is. Obviously, I've got some online stuff going on that's different now. But I would say everything starts online with a lead or a phone call that they saw online, and then it just sort of converts from there i sell a lot of cars out of state so we do a lot of facetime and zoom calls oh they don't even show up we'll just ship them right to them i've sold cars to hawaii all over the place i need a test drive personally you know what i mean yeah that's what's nice about

this new thing that i'm doing uh that's pretty exciting. But yeah, I feel that. Yeah, we'll dive into that. They say 87% of people want to test drive the car before they buy it. So that's why it's interesting about how Carvana's got so much success yet still you almost see 90% of people would rather test drive before they buy it. Wait, are you not allowed to test drive Carvana cars? So they have their exchange policy, right? So it's like you buy the car and then it comes and you have so many days to exchange it so you buy it before you even test drive it

interesting yeah now you said they're successful i was seeing some headlines not so long ago saying they were struggling is it is that changed uh well you got a few of the guys the juggernauts that were next to him that just announced that they went under i know uh vroom just said that they're no longer doing the online retailing space and a couple other big people that were next to carvana are kind of walking away from it the problem with and i shouldn't say problem they're still publicly traded there's still a juggernaut in the space right they do a lot of units but it's hard to be able to source all that inventory and recondition all that inventory, which we say like make it get ready is what we call that, right?

Paint a bumper or change the tires, any of that stuff. And there's so much time, so much holding cost to that, that it costs a lot of money to have that many cars in flux, right? And so it's tough. You've got to be turning them very quickly to be profitable. Right, which they probably aren't because they're so high up. There's like hundreds of cars in there. Yeah, so I think they normally float in between 20,000 and 40,000 roughly right now.

I think at their peak during COVID, they were listing about 80,000 cars. But they had to buy all those cars. And so they have all that interest that they're paying on it. Oh, they're not buying outright? No, most dealers utilize, whether it's their own flooring line, like they created their own or someone else's money. Most dealers utilize a flooring line, which is basically a giant credit card. If you think about it like that, that you buy the car, as soon as you sell it, you get funded on the car, and then you pay off your line and you go buy more. Oh, interesting. So you don't have to affront your own money.

No, no. Some dealers do. Some dealers don't. It's kind of a preference, but anybody that's doing it at scale, uh, utilizes some kind of flooring. Like I said, even if it's their own money, they probably have set up a flooring company to, to lend it to itself. This space is so fascinating to me because I wasn't into cars, but having on some podcast guests, I got pretty into cars recently. We were talking about Nick Dosa. He's doing nine figures a year out there, and that's just one city. It's crazy, especially when you get into those ultra lux or exotics. You make so much money, but the risk is so much higher too.

I don't know if you touched on this. I like being transparent and telling vulnerable stuff. I was telling you about that Lamborghini right before we jumped on. Are you interested in coming on the Digital Social Hour podcast as a guest? Well, click the application link below in the description of this video. We are always looking for cool stories, cool entrepreneurs to talk to about business and life.

Click the application link below, and here's the episode, guys. Depending on the market conditions, a car like that, say you're spending $300,000 on a car and all of a sudden everything changes in the economy. You can lose 40, 50, even a hundred thousand dollars on a car like that. And all of a sudden they're not selling because it costs so much to hold that as, as inventory, people have to liquidate it and keep the ball going or else you get stuck with it. So he's a very sharp guy. He knows how to move cars fast. Fast.

It's nice when you're in that space if you have the right connections. Say, oh, I have this. I'll let it go for that. Trade me something that you're sitting on. Whatever. It's kind of nice when you have those relationships. For sure, yeah. He told me some days he's selling five, ten cars. And these are expensive cars. They're like on, whatever. It's kind of nice when you have those relationships. For sure. Yeah. He told me some days he's selling five, 10 cars and these are expensive cars. They're

like six figures each. I'm like, geez, a million in a day. That sounds nice to me. Yeah. That's crazy. I get a lot of texts of some of the cars in the showroom and it's like, God, no, dude, I'm not jumping on that $3 million car right now. Sorry. Yeah. But like you said, cause like a year or two ago, those yours is where what? Almost half a mil. Oh yeah. They were insane. They were getting 100K over sticker sometimes, depending on their options, at least 40 or 50. It was dangerous. Same with like the G-Wagons when that new body came out during stuff. Yeah.

And they were getting crazy numbers over sticker. And then all of a sudden, it flipped like crazy. And you never know. The cloth could be pulled from you at any moment. And all of a sudden, you're stuck holding the bag could be pulled from you at any moment and all of a sudden you're stuck holding the bag did you get caught holding any big oh yeah so many times i've lost i've lost a lot of money and the problem is when you start liking cars i've been uh lucky lucky luckily enough i've driven a lot of cars where it doesn't get me as excited as it once

did but still i love cars i mean that's that's what I do. So I'll still buy things that I like personally that end up, uh, costing my company money. Everyone gets mad at me. I have a affinity for Range Rovers for some reason, and my whole company hates them, but I just like them. I don't know why they are polarizing. I've heard bad things about them going to the shop early and stuff. Yeah. I guess it doesn't matter if, uh, you don't have to keep them that long. Luckily I just saw them. Yeah guess it doesn't matter if you don't have to keep them that long. Luckily, I just sell them, right? Yeah, that makes sense. Is there any car brands you won't touch

just because the quality is so off the rocks or whatever? Actually, there's a lot of cars. What's kind of cool with how much volume I do, and I sell a lot of back-end products that help protect customers, but it gives us a lot of data in the sense of like, hey, the cost on this service contract

on this particular car is three times more than the average. So I actually have like a real list of I do not buy these cars because they have so many potential problems. And it's not only the problems that come up. Sometimes it's an issue like, hey, here's a very simple problem, but the fix is three months out or it's back order we don't know when we're getting it like uh audi has uh i have a q8 situation right now that's a good friend of mine that i sold it to him and so i'm personally involved in this story but it's just a little

12 volt battery that does the auto start stop yeah right you know when you stop with a light and it will stop if you don't turn off the battery that controls that has some defects in it and now everyone's having the same problem it all hits about the same time now you can't get them anywhere you know it's three to six months out that's what the oems are telling you and you don't even know if you're really going to get it the car literally can't drive without this little 12 volt battery that should be a hundred dollar battery and it's the car is just dead in the water until you can't even drive it no yeah so i'm like dude let's just trade you out of it let's get put you into something else and i'll figure it out it's crazy yeah i

get recalls on my tesla i don't i don't know if it's worth sending it back but yeah all the time yeah tesla is a whole nother thing how they do the how they run their market in their industry it's so unique even when i buy, I have to send them to Tesla. They don't let me work on them. Really? Yeah, and they don't let you buy any of their computer programs or anything to program them yourself. Interesting.

Yeah, it's super interesting. They keep it all in-house, huh? Yeah, like every other OEM, Audi, Ford, Chevy, whatever you can think of, as a dealer, you can buy all these programs, so you can recalibrate stuff if you put a new part on. But yeah, Tesla does not let you do it wow you buy any uh cyber trucks yet no i haven't yeah i haven't even seen one in person

there's a couple in vegas actually yeah yeah they look wild in person i haven't seen in person my friend dylan venost did it seems pretty wild yeah i i still can't believe that's a real thing like i look at it i'll see some instagram posts or whatever i'm like i can't believe that's a real thing. Like I look at it, I'll see some Instagram posts or whatever, and I'm like, I can't believe that. We live in a world where that crazy little Mars rover is just roaming around the streets. It seems like every brand is getting into electric now too. Have you noticed that? Yeah, I have. It's going to be an interesting thing.

I was just talking earlier about this, but the electric space has really, really shifted. I mean you can buy electric cars so much cheaper now than you could a year ago. It's wild. I mean, like half value on some of them. Well, Tesla's dropped their prices. Yeah. Crazy. Well, that's another thing. He does some wild stuff. No other OEM or franchisee has to deal with just all of a sudden a giant price drop on new stuff. So now all the used pre-owned inventory is all devalued. So it's a weird thing you have to navigate in my space. Yeah, you never know with Elon, man.

He's a wild one. I want to talk about Keezy. You've been working on this the past few years as a tech company. Tell us more about that. Yeah. So I was kind of mentioning this earlier too, but I wanted to find a way to scale my businesses vertically instead of horizontally. Right. And what I mean by that is every dealer that I looked up to when I was 18 growing in a space, it was all about, you know, brick and mortar, buy another location. Doesn't matter how much money.

You just keep buying, buying, buying, and you end up having this giant network of dealerships that you own. And I've worked with a lot of these dealer groups now with the auto mall that I've been building, and I see their processes. And it's hard to control your processes and what you care about in business when you get to that scale. And it's just so difficult. And then I was looking at companies like Amazon or VRBO or Uber even, right? You look at a company like that where they empower people to make money and it scales so much faster. The scalability is so much different. And so with Keezy, what I wanted to do was be able to create a marketplace similar to Amazon where I could take all the dealers that are in my network much different. And so with Keezy, what I wanted to do was be able to create a marketplace similar

to Amazon where I could take all the dealers that are in my network and then, and list all their inventory and be able to sell it online similar to how Carvana does. But you could still have in-person touch points, just like you said, you wanted to be able to test drive a car. So you can still shop locally, but buy a hundred percent online where you're not being, for lack of a better word, harass you're not being, for lack of a better word, harassed by the dealer, getting stuck in their CRM. So I created something that kind of puts a shield between you and the dealer and we facilitate the transaction.

So you're not stuck having to go give your information to six different dealerships because you found six cars you like where they're going to run your credit at each one. You have to get harassed on your trade in on each one. And I love dealers. There are some dealers that are a little more harassy than others. But I think for some buyers, that's necessary. It proves it with Carvana where people are willing to buy without even test driving the car.

They just hate that experience so much. So that's been a really fun project to be a part of. And I'm excited for it. We just launched on Friday of last week. That's exciting, man. Yeah, that's gonna change the car shopping game for sure. I think it really will. The nice thing about it is because it's completely online like that you get to eliminate some of the biggest expenses dealers have, whether it's commissions, you commissions or finance commissions or these different manager type roles that really are really expensive, but they're needed. But it lets you be able to turn your inventory a little quicker. If you could sell an extra 20% of your cars 100% online without

having to pay anybody to sell them. So I don't charge the dealer to list and I don't charge the customer to buy. We just facilitate it 100% online and I make money arranging your financing or taking in your trade or something back in. So it makes it so I can sell products cheaper than anyone else can because I don't have to pay someone to sell it to you. And ironically, the penetration is a lot better when you're not being asked to buy something by someone. You get to discern the information a lot differently and

really digest it and see if it's right for you. That's cool. Yeah. So the goal is to onboard a ton of big dealerships, basically. Yeah. So right now in the beta, I have six dealerships that I work with pretty closely in my market area that's launched on the beta. And then from there, I'll go Utah wide is my intention. And then just west coast to East Coast. This could be big, man. Yeah, I hope so. I think it's one of those things. You put yourself out there to be vulnerable. You're either going to do really well and you're a genius or you're an idiot and it all blew up.

Which, hey, I'm okay with that. I've always been all in on all this stuff. All in, baby. That's entrepreneurship, right? Yeah, that's for sure. Have you sold a car out to Post Malone yet? No, I haven't. I see him driving out there.

I know. And I'm really good friends with the Lamborghini Bentley dealer up north. So I live in southern Utah. He's in northern Utah. But yeah, man, I'd love to do that. So Post is watching. Let me hook you up. Just get it done.

What's the most expensive car you've sold? Most expensive car I've sold was a Huracan Performante, actually. I sold it for $350. I really get more into the high-turning space. That's where the money is. Nick Dosa will sell some really expensive stuff, but you're holding it. His turn time is a lot different than mine. My bread and butter is just following the market.

The last year year with interest rates going up, gas prices, expenses, everyone was kind of concerned about money. I shifted my entire focus over to more affordable cars and kept selling throughout the story. It's nice when you're riding that wave on cars, because if you get stuck holding, say like I averaged two to 220 in inventory, right? That's like my perfect little nugget to stay at a 45 day turn but if i hold those 200 cars for say three months because the market shifts now all of a sudden all 200 of those cars are worth a lot less than what i could replace them for today so my whole philosophy is just keep liquidating them all the way through a downturn

and then you buy on the upturn whereas Whereas a lot of people will see values dropping. They're like, oh, I'm not going to sell this at a loss. And they'll just diamond-hand it, if you want to say that. You're DCA-ing. Yeah, until the bottom. And then they wait until it comes back up, which is fine. They end up not losing maybe as much money, if you want to say it like that. But the difference is, if I can turn the car three more times in the time

that you're holding it for 90 days, then I've made money on the replacements, right? So you take the bite up front and it becomes a lot more profitable if you can stomach it. Sometimes it's stressful. Because it's hard to stomach a loss. So you're actually willing to sell hundreds of cars at a loss? Yeah. So the crazy thing is I only average in between $650 and $900 per car I sell. What? On the front. That's it? Yeah, that's it.

That's like the lowest margin I've ever heard. Yeah, I know. It's kind of wild. But we turn them pretty quick. And like I said, we take trade-ins. We sell back-end products. So the cool thing about my business model is you can buy a car from my dealerships and buy it so far back of what the market is and have a full service contract or gap insurance, whatever protections you want and still be less than what

the market is. So it's like, okay, I'm buying this car. It's this far back. And now I can add a service contract and it's still cheaper than what I'd go buy a four from someone else. Yeah, it makes sense. So it kind of has worked in a nice way for me. Yeah, that's cool. Have you heard of those people making an LLC? Is it Wyoming? I forget what state it is. Montana. Montana. Have you heard of that method? Yeah. So I actually just went through a whole thing with one of my really good friends who I love to death, but he knows that he's a pain sometimes. And he made me go through this with him. He started a Montana LLC, so he could register it there and pay the sales tax and stuff. And it's pretty common on expensive cars. I'll buy a lot of Lamborghinis or

anything in excess of $150,000. Yeah, it makes sense because you're not paying the sales tax, but there's just a lot that goes into it. Yeah, that makes sense. I know my buddy, I don't know if you know Mo Capital. He owns a luxury car rental. That's a whole nother space. Oh yeah, that's not in my wheelhouse at all. But since he has like 30 luxury cars, he did it in Montana.

Yeah, that makes sense. So with someone like that, like I don't know if he's a dealer, like where he's putting dealer plates on all those cars when he rents them, but I'm assuming for his insurance and bond purposes, he had to have them registered. So that's perfect for someone like that. Like for me, I don't personally buy anything and register it or ever pay sales tax on it.

With a dealer, you basically have insurance that covers all your cars. You're bonded for all your cars. And you have a dealer plate that's good for any car. So it's basically your registration for anything that sits in your inventory wow so you have one plate just yeah so i can you know go buy a urus and drive it and not pay anything different on my insurance or damn yeah that is sick it's got some good benefits for sure i just did uh my plates for my g-wagon it's like 1200 a year i was like damn yeah that what I mean. No one talks about that part of the thing. So a lot of my friends

that are finally getting into that space where they're willing to buy something exotic or luxury, it's kind of fun because I can help them through that. Buy it super cheap and then they can drive it for six months, flip it and make a couple grand and buy something else.

That's dope, man. I'll buy my next car through you. Yeah, I'll hook you up. End of this year when I need a little tax write-off. There we go. I'll text you in like December. For sure i'd be happy to help how much of your investments are in cars do you invest in anything else yeah i so i'm pretty all in in this uh koozie thing i've spent a lot of time and energy and money into that tech right and that's a weird

thing to invest in for me personally right uh where you're putting so much money into something that's intangible at first, right? It's not like a piece of land. Like I got some real estate deals that I really liked that auto malls are really a fun one that I've done and been a part of and, and watch that grow. But when you're talking about tech and you're spending all this money on something that you don't even know if it's real, it's some ones and zeros and some get space, you know, on some repository. When you're looking at stuff like that, I always go back. Ever since I started scaling my business, I always went back to kind of the Blockbuster analogy and model. Are you familiar with Blockbuster? Yeah, they went out of business.

They denied Netflix, right? Yeah, yeah. So how old are you? I'm 26. Okay, so I'm 33. So I literally remember going to Blockbuster on the weekends with my family and renting movies. I actually went to one. I caught the tail end of it.

Okay, cool. So at their peak, I mean, they were worth $3 billion. Damn. They had 65 million users actively in their CRM that they could have marketed to. Wow. One year I remember hearing that they made $800 million in just late fees alone. So just pure gravy off the top. I mean almost a billion dollars in late fees.

And when you look at them, and they weren't the first to, and even taking it back from Netflix, I mean Redbox came out. I remember Redbox. Redbox was sick. You could go get a movie for a dollar and they were just at a gas station so you didn't have to deal with the line or the minutia of all that stuff. But for Blockbuster not to come up with Redbox and then even worse, not to come up with Netflix. I mean, it is crazy how fast that if you don't innovate, you can become obsolete.

And if you look at their business model, it was annoying to customers to some degree, but it's all they had. They had to go in there and it was all fee and penalty based. That's how they made their money. So you make a mistake, they make more money. Whereas with Netflix, when they first started, you couldn't even really stream anything. They would literally mail you discs in the mail. You'd have to wait over a week to get them. And if that could catch on and become the juggernaut i became now it's like dude i i never wanted to be uh the dealer or in my industry and i hope this goes for whatever industry you're in don't ever be looking so so tunnel vision that you're not seeing some bigger picture that can let you change the entire way the industry's ran like this is something that no one has ever done because dealers in their essence want to hold on to every little secret they have.

You know, they don't want to share information besides those little dealer 20 groups I was talking about. But to be able to open it up and say, hey, I want you to make more money and I'll take a little piece of it. I want everyone to do better. Right. It's such an interesting way of thinking where my industry's never thought that way. They're old school. Oh, yeah. Yeah. It's brick and mortar way of thinking where my industry has never thought that way. They're old school. Oh, yeah. It's brick and mortar, brick by brick.

You just win by buying up everybody else and controlling the market. The cool thing about a product like Keezy or like what I'm creating is you protect both sides. So the consumer now has an unbiased shopping experience where say say, with Carvana, Carvana owns all those cars. They have incentive for you to buy their car, right? They have incentive for you to do their financing, all this stuff. For me, with Keezy, I don't care which car you end up buying because it doesn't matter if it's this dealership, my own dealerships, or someone else's. I'm just facilitating this transaction for you. And the same with the financing.

I created a marketplace for the financing where banks and credit unions compete for your loan. So like you look at a business model like that, it's going to be hard not to have the best deal because who could ever, you're going to let the capitalism be conducted inside your marketplace. Let dealers compete with each other and have better processes. And you just facilitate the story. Dude, I love that. I just paid 10% interest on my car. So imagine if I had other banks, I would lower that and compete for my business. And man, there's so many nuances in the auto industry that I wish I could talk more about. All the transparency stuff that should be brought to light. But this fixes all those things from my perspective and empowers both sides. The dealers, because the problem is everyone can blame dealers,

but, man, we're squeezed just as hard as the consumer is. I mean, all these different subscriptions, we have to pay to be relevant with all the different third-party sites. I'm not going to try and name any and get in trouble on any stuff because I do business with a lot of them. But, I mean, we're just nickel and dimed every turn, you know, like from buying it at the auction and using the flooring that I was talking about and having to listen, be competitive in marketing. And then all of your expenses that you have just as a dealer

and then your employees, it's tough. Yeah. You were saying the margins are thin. I never realized how thin they were, to be honest. I assumed in my head they were 10% to 20%. Yeah. But maybe that's too high. You got to think like you look at a car dealer. It's interesting because you could sell a $50,000 car and I might only make $2,000 on that. So like the revenue that moves through is a lot of money like on paper, but your actual profit could be very small. So percentage wise, it's, I think it's one of those interesting, uh, industries that people always think that

you're making more than you really are. Yeah. Cause what are the sales guys get? They're all commission based, right? Yeah. So my, my, uh, dealerships are a little different. I don't pay a lot of dealerships pay like a percentage of gross, right? So it's like, Hey, you sell something that we make more money on. You make more money. So when I changed my business model, um, you know, almost a decade ago now, it didn't matter which car that my salespeople sold them because it was one price. You didn't negotiate. You weren't going to be able to make more money. I'm was the one that built the algorithm that dictated what the price would be. So I knew the velocity of the car would sell in X days.

So I went to just a flat-based system. So instead of a percent, they just get a flat each time. Doesn't matter the price. No, it doesn't matter. It doesn't matter if it's a $200,000 car or if it's a $5,000 car that we took it on trade and selling it to someone else. So from an employee point of view, do you think that hurts their morale a little bit? Another common practice in dealerships, which I hate, and this is why people have such bad experiences going to dealerships normally, is they'll over flood the sales floor. So like where they say the average for a salesman, they'll sell eight cars a month, where the average of my salesmen will sell 18, more than double, right? Because I have such a small footprint on the sales force,

it totally changes the dynamic of how they interact with the customer, right? If you're like only going to see one up a day, which we call a lead up, like someone comes to the dealership, you're going to do whatever it takes to sell that person. If you have 30 leads sitting in your CRM, you're just so much more relaxed. You don't have to feel this high pressure to feed your family. And it's nice because we'll have five or six leads on a car that we just got yesterday. Right. So it's like, Hey, you don't have to have any weird pressure to put on the customer to buy. It's really the only pressure is you're fighting against other people, other customers that want

the same car. So I think it created a better environment. Interesting. That's cool, man. Jared, it's been fun getting to know the car space, man. Anything you want to close off with or leave the audience with? No, I'd just say do your research. You know, there's so much stuff

online these days. You can find a good deal. You can look at reviews. Just make sure you're dealing with the right type of dealer. And there's some good guys out there. Absolutely. Thanks for putting the car space in a good light, man. because some people get a bad taste in their mouth from car dealership

yeah it happens but i appreciate you having me on absolutely thanks for watching guys thanks for coming on see you tomorrow