NEW YORK — Vroom, an online used car retailer, has completed a $50 million Series E funding round with new investors Altimeter Capital and Foxhaven Asset Management, joining previous investors L Catterton, General Catalyst Partners, Allen & Company, and funds and accounts advised by T. Rowe Price Associates, Inc. The new financing brings Vroom’s total funding to $218 million since inception.
The company’s continued strong revenue growth has been driven by innovation that is leapfrogging the traditional car buying and selling process. Under the recent leadership addition of CEO Paul Hennessy, former Priceline.com chief executive, Vroom has positioned itself to take advantage of the rapidly increasing consumer preference to purchase and sell cars in smarter, easier ways.
“The reaction to both the ease of the car buying and selling experience, as well as the unparalleled quality of refurbished cars, has been overwhelming,” said Mr. Hennessy. “For a company that is only three years old, we are just beginning to roll out our product innovations that will soon include 100% digital paperwork and auto financing enhancements. The continued support of our incredible board led by Chairman Bob Mylod, the vote of confidence from our existing investors and the addition of two new world-class investors to our capital base gives us the firepower we need to achieve our goal of becoming the largest pre-owned car retailer in the nation.”
Vroom redefines how cars are bought and sold, by bringing the entire process online and on mobile. Car sellers need only to scan the VIN, submit pictures of their car and answer a few questions for an instant cash voucher. Car buyers can sit comfortably at home, avoiding the high pressure situation of used car salesmen, and search through one of the largest selections of pre-owned cars. Both buyers and sellers get free car pickup and delivery, respectively. Car buyers benefit from a 7-day money back guarantee, which essentially replaces the traditional test drive. The company is expected to generate well in excess of $1 billion of revenue in 2016.
“Vroom is positioned to be a leader in the online used car market by revolutionizing car buying and selling,” said Henry Ellenbogen, Portfolio Manager at T. Rowe Price Associates, Inc. “We believe that Vroom’s leadership team has the ingredients necessary to build a much larger company.”
Vroom empowers customers all over the country to save time, hassle and money by bringing all three aspects of the car buying process – buying, financing and selling – online in an easy, transparent and affordable way. Vroom offers thousands of high quality, refurbished, pre-owned vehicles with free delivery to customers’ doors nationwide. The company is based in New York, Dallas and Houston, also operating the Texas Direct Auto brand.