Used-car prices may be softening, but the space is heating up as lenders discover new efficiencies with technology. Case in point is online used-car seller Carvana, which announced last week it was in the process of raising $300 million to sell directly to customers.
Rather than serving as a marketplace for buyers to connect, Carvana buys the cars from consumers and auctions, then reconditions and sells them. It is backed by DriveTime, which also provides optional customer financing through its finance company, GO Financial.
Carvana already has $50 million in funding. Based in Phoenix but selling cars mostly in the Southeast, Carvana could expand its reach nationwide with the additional funding.
Carvana, which launched in 2013, attained $45 million in gross revenue in 2014, and projects $120 million for 2015.
