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TrueCar, Inc.
Company typePublic
Nasdaq: TRUE
Russell 2000 Component
IndustryTechnology
FoundedFebruary 2005; 19 years ago (2005-02) (as Zag.com)
FoundersScott Painter, Tom Taira
HeadquartersSanta Monica, California, U.S.
Key people
ProductsPricing and information for new and used cars
RevenueDecrease US$ 161.5 million (2022)
Decrease US$ -65.9 million (2022)
Decrease US$ -60.1 million (2022)
Number of employees
Decrease 340 (2023)
Websitetruecar.com
Footnotes / references
[1]

TrueCar, Inc. is an automotive pricing and digital retailing website for new and used car buyers. The service allows users to see what others paid for any new or used vehicle in their local area and receive upfront prices from a network of over 15,000 TrueCar Certified Dealers. TrueCar is paid by dealerships so they can be introduced to and communicate with potential new and used car buyers. TrueCar supports over 1 million new and used car transactions between dealers and its users each year. The company is headquartered in Santa Monica, California,[2] with a sales office Austin, Texas.[3][4][5]

History

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2005–2010: Early years

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TrueCar was originally incorporated under the name "Zag.com Inc." in Delaware in February 2005. Scott Painter and Tom Taira started the business to provide white-label auto-buying programs to affinity groups. The company's initial partner was Capital One in order for its customers to arrange financing, access upfront pricing, and locate inventory online.[6] Other noted co-founders include Jim Nguyen, Oded Noy, and Bernie Brenner.[7][8]

After a year of development, Scott Painter (Chairman) and Tom Taira (President) introduced TrueCar during the Techcrunch's Startup Battlefield in September 2008, launching it as a separate company from Zag.com.[9] TrueCar gathers automotive retail transaction data from thousands of sources in order to enable consumers "to see what's paid" on any vehicle in the US.[10][11] The two companies merged in 2010.[12]

2011–2014: Pre-IPO

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TrueCar logo from 2011 to 2020

In January 2011, TrueCar released ClearBook, a used vehicle index that analyzes the used car market in the same way TrueCar did for new cars.[13][14] In May 2011, TrueCar acquired News Corp-backed Honk.com, a social car shopping platform.[15]

In late 2011, TrueCar launched a television advertising campaign with commercials promoting its services.[16] Shortly thereafter, TrueCar faced backlash from the automotive industry,[17] when several state agencies and regulators notified TrueCar that its practices were noncompliant with some state laws.[18][19] In response to those notices, TrueCar overhauled its pricing structure,[16] and moved from a pay-per-sale model to a performance-adjusted subscription model for dealers in some states.[20]

In August 2011, TrueCar purchased ALG, a company that provides information on future residual values of vehicles, for an estimated $83 million.[21] In January 2012, TrueCar announced a three-year, exclusive partnership with Yahoo! for $150 million. TrueCar took over Yahoo's automotive properties and replaced it with their own solution.[22]

TrueCar launched the first all-female racing team in 2012, with support from Penske Media Corporation and Dragon Racing.[23][24] In June 2012, The Virgin Group announced its partnership in support of TrueCar's "Women Empowered" initiative.[23]

On May 16, 2014, TrueCar became publicly traded on NASDAQ under the stock ticker symbol TRUE.[25]

2015–2019: Chip Perry Era

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In December 2015, Scott Painter stepped down as CEO of TrueCar and was replaced by Chip Perry, the former CEO of AutoTrader.com.[26][27] Under Perry, TrueCar's network of dealerships grew more than 24 percent quarterly over the prior year, as reported in July 2017.[28]

In 2015, 108 car dealerships sued TrueCar for false advertising of its non-negotiation policy and for violations of the Lanham Act.[29][30] A federal judge dismissed the lawsuit in July 2019.[31] Also in 2019, some investors in TrueCar sued the company for misleading shareholders.[32] Separately, in December 2017, TrueCar and the California New Car Dealers Association settled a lawsuit that the association had brought against TrueCar in 2015.[33] In its lawsuit, the association had alleged that TrueCar's billing model violated California law.[33] As part of the settlement, TrueCar agreed to modify its billing model in California.[33]

Shortly after disappointing first quarter results in 2019, TrueCar announced the immediate resignations of the accountable senior executives, including CEO Chip Perry, CTO/CPO Tommy McClung, CMO Neeraj Gunsager, and EVP Brian Skutta.[34][35]

2020–present

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In January 2020, the company launched a new brand identity and redesign. In May 2020, TrueCar announced a program focused on active military members[36] designed to help offset its loss of the USAA Car Buying Service. In May 2020, TrueCar announced a restructuring of the company, including layoffs of 30% of its workforce.[37]

On June 14, 2023, CEO Michael Darrow resigned after leading the company to four straight years of declining financial results. The company's CFO, Jantoon Reigersman took over as CEO and promptly laid off 24% of the company's employees. [38]

See also

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References

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  1. ^ "US SEC: Form 10-K TrueCar, Inc". U.S. Securities and Exchange Commission. Retrieved February 17, 2018.
  2. ^ "Company Overview of TrueCar, Inc". Bloomberg Businessweek. 2012. Archived from the original on May 2, 2013. Retrieved 17 November 2012.
  3. ^ Dorin Levin (November 17, 2014). "TrueCar's stock revs up". Fortune. Retrieved November 25, 2014.
  4. ^ Katie Roof (May 16, 2014). "TrueCar Up 20% in IPO". FOXBusiness. Archived from the original on May 19, 2014. Retrieved May 23, 2014.
  5. ^ "1 Million Cars in 2018: A Closer Look - TrueCar Blog". 1 Million Cars in 2018: A Closer Look - TrueCar Blog. 2019-02-22. Retrieved 2020-05-30.
  6. ^ Staff. "Capital One, Zag Launch Online Shopping Program DriveOne". www.fi-magazine.com. Retrieved 2020-05-27.
  7. ^ "TrueCar Has No Profits But Billion Dollar Valuation". Seeking Alpha. June 17, 2004. Retrieved February 21, 2019.
  8. ^ EquityNet. "TRUECar". EquityNet. Retrieved 2019-02-22.
  9. ^ "Online Auto Pioneers Scott Painter and Tom Taira Launch New Company, TrueCar, at TechCrunch50". www.businesswire.com. 2008-09-11. Retrieved 2020-05-27.
  10. ^ "Zag Spins Out TrueCar". SocialTech.com. 10 September 2008. Retrieved 17 November 2012.
  11. ^ Scott Painter, Mark Suster. This Week In Venture Capital #12 With Scott Painter (video). This WeekIn. Archived from the original on 2012-11-15.
  12. ^ Keegan, Paul (2014-11-04). "What Happens When the Disrupter Gets Disrupted?". Inc.com. Retrieved 2020-05-30.
  13. ^ 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.
  14. ^ Shaun Conlin (26 October 2010). "TrueCar Announces ClearBook Used Car Pricing Aggregator". EverGeek. Archived from the original on 29 July 2014. Retrieved 17 November 2012.
  15. ^ Robin Wauters (3 May 2011). "TrueCar Acquires News Corp-Backed Automotive Social Network Honk.com". TechCrunch. Retrieved 17 November 2012.
  16. ^ 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.
  17. ^ "TrueCar Revamps Pricing Curve". F&I and Showroom. 6 September 2012. Retrieved 17 November 2012.
  18. ^ "The TrueCar Challenge". Economist. 2012. p. 59.
  19. ^ Doron Levin (18 January 2012). "TrueCar Is Running Into Roadblocks". CNNMoney. Retrieved 17 November 2012.
  20. ^ "TrueCar Unveils Compliance Strategy". F&I and Showroom. 17 January 2012. Retrieved 17 November 2012.
  21. ^ Sawyers, Arlena (2011). "Painter's Vision: Sales with No Sales Staff". Automotive News. p. 8.
  22. ^ Ferenstein, Gregory (2012-01-03). "Yahoo Autos Partners With TrueCar, Brings Transparency To Car Buying". Fast Company. Retrieved 2020-05-30.
  23. ^ a b "Virgin Group Aligns with TrueCar Racing's IndyCar Program, Women's Initiative". Auto Week. 13 June 2012. Retrieved 17 November 2012.
  24. ^ Yvonne Wenger (1 September 2012). "All-women Team Leaves Mark on Grand Prix of Baltimore". The Baltimore Sun. Retrieved 17 November 2012.
  25. ^ "TrueCar jumps in its 1st day on the Nasdaq". AP. 16 May 2014. Retrieved 7 September 2014.
  26. ^ Hirsch, Jerry. "TrueCar posts big 2nd-quarter loss; CEO Scott Painter to step down". Los Angeles Times. Retrieved 2019-05-14.
  27. ^ "PressReleases". TrueCar, Inc. Retrieved 2019-05-14.
  28. ^ Miller, Daniel. "2 Reasons TrueCar, Inc. Is Still a Buy After Rising 150%". The Motley Fool. Retrieved 2018-01-26.
  29. ^ Hannah Lutz (2019-04-02). "Dealers' lawsuit against TrueCar could head to trial". Automotive News. Retrieved 2020-07-04.
  30. ^ "Dependable Sales and Service, Inc. et al v. Truecar, Inc". Justia. 2015-03-09. Retrieved 2020-07-04.
  31. ^ "Dependable Sales and Service, Inc. et al v. Truecar, Inc". Pacer. 2019-07-15. Retrieved 2020-07-04.
  32. ^ "TrueCar Execs Face Investor Suit Over Partner Site Reboot". LAW360. 2019-04-02.
  33. ^ a b c Jamie LaReau (2017-12-14). "TrueCar, California Dealers Association settle lawsuit". Automotive News. Retrieved 2020-07-04.
  34. ^ Luis Sanchez (2019-06-28). "Expect More Pain for TrueCar After Its CEO Departs". The Motley Fool.
  35. ^ Spencer, Greg. "TrueCar post-Perry: Two gone, reorg set - AIM Group". aimgroup.com. Retrieved 2020-05-27.
  36. ^ "TrueCar Expands Military Car Buying Support with Launch of 'TrueCar Military'". GlobeNewswire News Room. 2020-05-04. Retrieved 2020-05-30.
  37. ^ "2 factors prompt TrueCar to trim workforce by 30%". Auto Remarketing. 2020-05-29. Retrieved 2020-05-31.
  38. ^ "TrueCar lays off 102 employees, taps new CEO amid restructure".
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