Auto shopping site CarGurus grows into new Cambridge office space; approaches $40 million in revenues
The site uses sophisticated software models to help shoppers evaluate hundreds or thousands of a given model of used car on the market. "There may be 600 Ford Focuses being sold in Boston," Steinert says. "We help you figure out whether a 2009 with fewer miles than a 2010 might be a better deal, based on trim packages and options and other factors." About a month ago, CarGurus launched a service that also looks at new car inventory in a user's geographic area. Steinert says that when looking for a Toyota Land Cruiser for his wife, he was frustrated by having to visit or call dealerships to find out what specific cars they had in stock, in what colors. "Adding new cars to the site is the big push for this year," he says.
CarGurus has 23 employees, and Steinert foresees hiring another 15 or 20 by the end of the year. Revenues, which today come from selling "leads," or information about prospective car buyers, "are closing in on a $40 million annual run rate," Steinert says. Eventually, he says the company will transition to selling its marketing services to dealerships on a subscription basis, to help them market their new and used inventory. Steinert tells me that the company got to profitability with just $4 million of funding — "all from friends and family, and the TripAdvisor mafia" he says.
He says CarGurus receives about five million visitors each month. The category leader, AutoTrader.com, sees about 11 million uniques. It filed to go public last year, and is doing about $1 billion in annual revenues.
But Steinert doesn't plan to be left in the dust: "I want to be first — and take out AutoTrader."
About Scott Kirsner
Scott Kirsner was part of the team that launched Boston.com in 1995, and has been writing a column for the Globe since 2000. His work has also appeared in Wired, Fast Company, The New York Times, BusinessWeek, Newsweek, and Variety. Scott is also the author of the books "Fans, Friends & Followers" and "Inventing the Movies," was the editor of "The Convergence Guide: Life Sciences in New England," and was a contributor to "The Good City: Writers Explore 21st Century Boston." Scott also helps organize several local events on entrepreneurship, including the Nantucket Conference and Future Forward. Here's some background on how Scott decides what to cover, and how to pitch him a story idea.
Subscribe via e-mail
More from Scott
March 3: Web Innovators Group
Demos, drinks, and schmoozing at the Royal Sonesta in Cambridge.
March 7-8: MassDigi Game Challenge
Competition for aspiring game developers... plus panels and keynotes related to the business of play.
April 3-4: Mass Biotech Annual Meeting
Issues facing the region's life sciences community.