Updated: Roadster Secures New Funding, Announces New Ties With Lithia, Lexus
June 27, 2018
SAN FRANCISCO — On the heels of securing $15 million in new funding, Roadster today announced it is now a Lexus-preferred digital retailing partner. The startup also announced that a formal agreement is in place to begin outfitting Lithia Motors dealerships with it omnichannel ecommerce solution.
Led by existing investor Costanoa Ventures, the new funding adds to the $15 million the startup had already secured and brings its war chest to $30 million. Roadster CEO Andy Moss said the new funding will be used to help Roadster scale its operations, expand its field and sales teams, amplify marketing efforts, and further evolve its suite of solutions.
“I think the reason investors are stepping up so quickly is the momentum we have in the market,” he said. “We finished 2017 with approximately 150 dealerships. We’ve doubled that six months into 2018.”
Moss said the company is about two things: providing an end-to-end new-car buying experience as well as a true in-store solution that allows salespeople to handle deals on an Apple iPad. Moss said it’s that omnichannel approach, which the company began pursuing in April 2017 with the release of its Express Storefront solution, that separates Roadster from the Silicon Valley startups that have entered the market and ahead of some of the industry’s more established tech firms.
Last September, the company began working with a handful of Lithia Motors stores. With today’s announcement, a formal agreement is now in place with the publicly traded dealer group to begin outfitting more stores with the startup’s ecommerce platform.
Lithia is the latest addition to Roadster’s roster of big-name dealer operations, which includes Penske’s Longo Toyota in Southern California, Paragon Honda and Acura, Lexus of Lehigh Valley in Allentown, Pa., and Mercedes-Benz of San Francisco. That list is sure to grow with the company’s newly forged relationship with Lexus.
“Lexus had been relying on traditional website providers to add some part of digital retailing. They’re now expanding that out,” Moss said, noting that four to five Lexus stores had signed up with the startup just prior to today’s announcement. “We thinking there’s a lot of opportunity there. It’s a great indication of where the OEMS are heading as well. There’s a lot of interest among OEMs across the board. They’re seeing their dealers being successful with this.”
According to Lexus officials, Roadster joins Tagrail, Dealer.com and CDK Global as Lexus-certified digtial retailing platform providers. "Lexus has always placed the guest experience at the forefront of every decision we make," read a statement the automaker issued to F&I and Showroom. "Our goal is to treat customers as we would a guest in our home also translates into the digital ecosystem. We constantly strive to offer our dealers the best digital solutions in which to accomplish that goal, while providing guests with an industry-leading digtial experience."
Moss said about 10% of car buyers are completing the entire buying process online, adding that most dealerships are using its Express Storefont solution as a first pencil. “The goal is really to help the dealer in every transaction,” he said. “We’re about sales efficiency, sales process and customer experience.”
It’s one of the reasons the company continues to expand its product line. Aside from Express Storefront, the company offers Express Trade, a solution designed to centralize the valuation process for dealerships while allowing car buyers to submit their trade information prior to entering the dealership.
Days before the National Automobile Dealers Association’s 2018 convention in late March, the company rolled out Express Marketplace. The platform is designed to turn a dealer group’s “home” site into an ecommerce portal. It does so by aggregating a group’s entire inventory along with Roadster’s ecommerce experience.
“Over the past year, Roadster has transformed from a Silicon Valley startup into a powerful force in the automotive industry,” Moss said. “Our suite of branded Express products have helped dealers, dealer groups, and OEMs significantly improve operating results and we have become the go-to omnichannel commerce solution for dealers looking to streamline their sales process.
“With over 300 rooftops, including relationship programs with automotive groups like Lithia and our participation as one of four Lexus certified digital retail partners,” he added, “it’s clear we’re onto something big.”
Updated on 8/2/18: The article now includes a statement from Lexus. The automaker also provided the names of the other Lexus-approved digital retailing providers.