Carlypso (YC S14) could change everything about how we buy and sell used cars

http://techcrunch.com/2014/06/18/carlypso-could-change-everything-about-how-we-buy-and-sell-used-cars/

by sama • 12 years ago

73 40 12 years ago

techcrunch.com

jcr• 12 years ago

On the "How It Works" page, there's mention of installing a "Carlypso device" on the vehicle:

http://www.carlypso.com/how-it-works/

"2.We'll send an inspection mechanic, who also attaches our Carlypso device"

I also quickly searched the FAQ for "device": http://www.carlypso.com/faqs/

I must have overlooked it but are there any details on what a "Carlypso device" actually is?

bri3d2• 12 years ago

According to the TechCrunch article here:

http://techcrunch.com/2014/06/18/carlypso-could-change-every...

the device is used to track potential buyers while they're on test drives. So it's at least got a GPS and some kind of data functionality. It would be smart if it included OBD-II functionality to see if the test-drive customers are beating on the car, but I don't see any reference to that kind of feature.

If you watch the video, there's also a license-plate lockbox for the key so that you never have to deal with a buyer personally.

toomuchtodo2• 12 years ago

"It would be smart if it included OBD-II functionality to see if the test-drive customers are beating on the car, but I don't see any reference to that kind of feature."

The only metric you'd want from the OBD port is the tach; you can get speed from GPS, acceleration from your own accelerometer sensor ("flooring it", stopping hard), etc.

gambiting2• 12 years ago

$50 GPS jammer from China coupled with another $50 GSM/3G jammer also from China = you drive away free, with no tracking devices working. I would be very worried to use this service.

cygni3• 12 years ago

AFAIK the device is just a GPS transponder. On my Civic it was plugged into the same port that's used to test emissions.

bri3d2• 12 years ago

It sounds like it could include OBD functionality, then - or it might just be grabbing 12V from there.

nlh• 12 years ago

It's a _really_ great idea - congrats on the publicity and launch guys.

I cannot count how many times friends have called me to ask "So, how do I sell my used car?" I never have a good answer (The trade-in-to-dealer process is the easiest but by far the worst financially) .

On the question (from the video) of 'What if it gets stolen?'

"At worst, you get paid for the car."

Heh. This brings up a number of thoughts -- I mean, in the end, your goal as a seller is to sell the car. If it gets stolen, your insurance company pays you for the car, so...mission accomplished?

If that becomes a regular occurrence, it creates a weird market condition -- thieves win because they get an easily-stolen car. The seller wins because he's sold his car quickly. So the insurance company loses -- and who gets left holding the bag?

(Not saying this is a real risk - I think these guys are going to do wonderfully - but a thought experiment...)

p0ckets• 12 years ago

Insurance companies would start charging more for letting potential buyers drive your car.

gambiting2• 12 years ago

Presumably, Carlypso will provide their own insurance.

ry0ohki• 12 years ago

"If it gets stolen, your insurance company pays you for the car, so...mission accomplished?"

Except your rates go up, and they may give you less than you could have sold it for.

ski• 12 years ago

Depending on the types of cars, theft is a valid concern. HiGear was a car service that rented out luxury cars and had to shut down because they were hit by a criminal ring [1].

Agree that its not a showstopper if you're vigilant, so it's good that they're thinking about it from the outset.

[1] http://techcrunch.com/2012/01/01/luxury-car-sharing-service-...

PeterWhittaker• 12 years ago

Please come to Ontario. Please!

AnimalMuppet• 12 years ago

This is great!

Now if they could just expand it to real estate...

lpolovets• 12 years ago

Here's a startup that's planning to do just that: http://recode.net/2014/05/23/khoslas-keith-rabois-aiming-to-...

cygni3• 12 years ago

I used Carlypso to sell my Honda Civic a few months ago. Everyone involved was helpful and professional. I ended up getting a lot more than I would if I traded it in to CarMax, and the steps involved were minimal. I'd definitely recommend them.

callmeed• 12 years ago

Which method did you use? (there are 3 options after enter your car info).

I am thinking of selling my Honda Element and the prices offered seem pretty low.

cygni3• 12 years ago

At the time the only option available was "Carlypso Concierge".

Carlypso listed my car slightly under what kbb.com said it was worth, which was fine with me. I assume this was to speed up sales.

toomuchtodo2• 12 years ago

Ugh, I live in Chicago and had to use Carmax last night to dump a car I wasn't using. I could've gotten more if I spent time on Craigslist, giving test drives, etc but the ~$1500/difference wasn't worth it to me.

Carlypso, come to Illinois. Please.

sixQuarks2• 12 years ago

http://www.instamotor.com is in the same space. Looking at both of their sites, Instamotors seems more inviting and explains things better.

There's no question that the space is ripe for disruption, but the problem with both of these services are:

1) How does the consumer know you'll actually get a better price for them? The only way to know for sure is to list it yourself and see how you would do. There is a conflict of interest here, because these sites would rather have a quick sale than take a long time negotiating an extra few hundred dollars.

2) I don't necessarily feel comfortable giving strangers access to my car so they can give other strangers test drives.

damonpace• 12 years ago

Instamotor's CEO bought a car using Carlypso and decided to copy the model. That's the Instamotor story.

thedogeye• 12 years ago

Sam Walton visited Montgomery Ward and decided to copy the model. That's the Walmart story.

jcliff• 12 years ago

Also in the same space is beepi. http://www.beepi.com

They solve your second concern by not offering test drives to potential buyers.

sixQuarks2• 12 years ago

How do they expect people to buy the car if they don't allow test drives?

davidjade• 12 years ago

Who's liable for when your car is test driven and gets in an accident? Or worst, used in a negligent way. IANAL but I think that car owners can be held responsible for lending a car that is used by a driver that is found to have been negligent (google: negligent entrustment).

edit: Just to be clear, I'm talking more about when cars are test drive without the owner present, as seems to be possible here.

incision• 12 years ago

Enormous potential.

I would use this in a heartbeat if it were available here.

They could probably get away with twice the rake - the experience of personally buying/selling a used car is that bad and dealers/Carmax lowball that low.

Personally, I'd like a service which caters the intersecting possibility of evaluating and buying cars which need work packaged with bids to complete said work. Then perhaps I could get my hands on the e39 wagon I've always wanted.

spo81rty• 12 years ago

One of their biggest competitors is going to be AutoTrader.com and maybe even similar sites that already have a massive audience on the buying side. AutoTrader offers a VIP service for selling cars where they talk to people and take care of some of the stuff you don't want to mess with. I have not used it myself. But it is about $150-$300.

https://sell.autotrader.com/syc/vip/package_selection.jsf?zi...

I don't think very many people even know you can do this with AutoTrader

roschdal• 12 years ago

"The seller never needs to meet the person who buys the car."

Honestly, this sounds like a HUGE risk to me.

tlb• 12 years ago

Compare against the risks of meeting in person with respondents to your used car ad: http://www.moneyfile.net/finance-news/dangers-of-selling-you...

krschultz2• 12 years ago

That sounds like exactly the same risk as meeting a person you met online in any conceivable way. Online dating, all of Craigslist, even job interviews have the same risk.

krschultz2• 12 years ago

Yea. If I had a nice car, no way in hell I would sell it this way. What stops people from joy riding?

Someone could go on Carlypso tomorrow and say they were interested in 'buying' a Subaru STI. Nope, didn't like it. Now they're interested in 'buying' a BMW 3 series. There is a reason you can't walk into a car dealership and start driving cars without someone screening you.

If you think that is an idle concern - I've had joyriders come and try to test drive my vehicles that I have listed on craigslist. It is an infuriating waste of time - and the best reason I've ever found to use a dealer/broker to sell things for you.

mzs2• 12 years ago

I wonder how they will protect against scumbag sellers. It seems that there is already a lot of value to just filtering the potential buyers. How can they protect themselves from a seller being there when the potential buyer shows-up and then working out a sale on the side? Anyway I've taken advantage of some of the crazy but cool trades that happen from selling used cars so I'm not really a customer.

NDizzle• 12 years ago

Maybe most people on here aren't car guys, but I'm cruising the current cars they have up for sale on the site and every single one seems overpriced to me.

The G series MB seems interesting, but I trust a used MB about as far as I can throw it.

It'll probably be a hit for the masses, but I'll stick to haggling and craigslist.

qq66• 12 years ago

It's just anecdotal, but I bought a '98 Mercedes with ~120,000 miles for a few thousand bucks. It's been rock solid for the ~20,000 miles I've put on it since.

rburhum• 12 years ago

I sold my car through them early on and recommended a couple of friends to do the same (they did end up selling through Carlypso, too). What a great service. I also did a video testimonial because of how much I liked their service. I can't imagine this startup not taking off.

zissou• 12 years ago

I have been researching the used car market for the last year in an academic lab. I would love to share stories about data collection and management if Carlypso folks are interested. Not looking to be a consultant or being consulted or any kind of a "gig". As I'm sure they know, used car data is a crazy world of imperfect data points, especially as the car becomes older (>6 years old I'd say data quality begins to break down fast). What proportions of your data are scraped, purchased, or maybe even obtained from a free API like Edmunds.com? I doubt you're using Edmunds as I didn't catch any affiliation info on the site.

I laughed at the "oh yeah that makes sense" story of the big truck being priced higher in TX. My goto story is always the price of convertibles in the winter in MN vs. TX, or the price of an AWD sedan in the winter in MN vs. TX.

Speaking of AWD sedans, I know it's a rare car so this is nitpicky but your 2008 Saab 9-3 data classifies a Turbo X as an Aero. Also the Turbo X trim isn't listed for the wagon. At any rate, your estimate for the Sedan Turbo X is about 20% too low. Granted they only made 600 for the US market, I was still bummed that a car which is so dear to me had this issue. Haha, I'm not trying to be that guy whatsoever! In fact I was happy when I saw Saab was even listed as a Make as many don't even acknowledge them anymore! :(

Anyways let me know if you guys are up for a friendly talk.

MITengineer• 12 years ago

@ Zissou - I'm Chris a Carlypso Co-Founder. I'm always up for a friendly talk!

Getting the pricing to be reliably accurate was one of the biggest challenges. We tried many of the third party tools only to realize that most were not accurate for our needs.

We do a few things that distinguish our pricing from other sources after realizing no third-party tool worked particularly well. Granted, there are anomalies but here's a few brief guiding principles:

(1) As you pointed out the region matters - a truck in TX is not the same as one in central San Francisco. (2) A listing is not the same as a sale. Dealers often attempt to hold gross margin when a car comes in, then gradually reduce to market rates to sell the car in a period of 30-45 days (e.g. price it high to start and then lower it). We measure how long a given car has been listed on a dealer's site, and often cars listed for a higher price only sell after they are reduced to a lower price. We can do some validation of the final negotiation with DMV records and comparing those values to final listing prices. Fewer and fewer cars have large negotiating margin. (3) You can measure the relative demand and supply of the vehicle market by looking at the flow rate of the vehicle relative to the total local market supply (E.g. measure how many civics sell in a given month relative to how many are available that month). (4) Everyone claims their vehicle is perfect but every vehicle we inspect needs some level of refurbishment so we factored that into our pricing to give "average levels". If a car truly is perfect, we're more than happy to help sell it for more than we predicted, we just prefer to be direct and honest upfront rather than reduce prices after the inspection occurs. (5) The price floor is always set by what someone else would pay in very short notice. This is most easily observable by looking at auction values.

As a side-note, pricing a rare car is virtually impossible --- we can only price cars where there's a significant market and low levels of heterogeneity. The variance on a 1967 Porsche 912 can't be estimated by traditional models since a numbers match car with Fuch's wheels and three gauges is worth more than a restored car with non-numbers match engine, 5 gauges and re-welded floor pans.

- Chris

mzs2• 12 years ago

I just checked your site out and wanted to give a little feedback since I like the idea after some mulling.

To buy a car it's somewhat annoying. There is no good way to filter based on things such as transmission for example or search based on anything at all such as location or price even. I have to go through the whole list and as you grow that will be no longer viable, it was already a pita.

Also when I go to an individual car there are very few details. The photos are good and what a lot of terrible CL ads lack, but it would be nice to have the specific engine in the car for example since in many cars there are many options there. I also expected a list of options and standard items like carmax gives.

Finally you should include the VIN, I always have a friend run it for me before I even see a car, that has saved me so much time.

Good luck!

nwenzel• 12 years ago

I'm buying a car and checked out the service. So much better than randomly driving around to various lots. It's an improvement on buying from an individual. Cars have been inspected. No way I'd buy a car without the inspection. But at a dealer that means the car costs about the same as a new car.

jqm• 12 years ago

I clicked on the article expecting to see "a website that sells used cars" but claims to change EVERYTHING about the way used cars are sold (no shortage of these types of start ups)...

I was pleasantly surprised to be wrong. From sending out a certified mechanic to attaching a device... this really does seem like a good idea and very cool...

Carlypso (YC S14) could change everything about how we buy and sell used cars

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