The answer to that last one for most of us? Not much.
This is where Carsome, a new car buying site that allows buyers to research, compare cars, and obtain upfront price quotes from certified dealers, comes in. Besides highlighting the best possible offers available, Carsome also provides buyers with financial data such as the downpayment, road tax, insurance, and more ― which means one is less likely to suffer from buyer’s regret afterwards.
Carsome was founded by Chief Executive Officer Eric Cheng and Chief Operations Officer J. Teoh. First-time entrepreneur Cheng took the Steve Jobs route to discovering his true passion. He says, “I went to college trying my luck with the ACCA but half way through I realised accounting was not my thing. So I dropped out and started trying out different things to earn a living.”
This eventually led him to Innity, an interactive online marketing company where he rose to the position of Account Director for Malaysia. This was when he met Teoh, then an Associate Account Director at the firm. While neither had been involved in other start-ups prior to Carsome, they were convinced the entrepreneurial path was the way to go.
“We thought of the idea for Carsome around March last year,” says Cheng. “We always hear stories from friends and family about how buying a car can be exciting but yet at the same time complicated. For instance, awkward face-to-face haggling and uncertainty over whether you are overpaying.”
After extensive market research, and speaking to both car buyers and dealers, the duo learned more about how the industry worked and specifically investigated the pain points for consumers. Teoh explains, “Consumers want a convenient and less stressful way to compare dealers’ offers on new cars without the trouble of negotiating price. Dealers, on the other hand, want a source of high quality leads to hit the tough volume targets and expand their customer base too.”
With all this in mind, Cheng and Teoh started Carsome as a car buying platform for new car buyers to research cars and submit their interest in the ones they would like to receive offers on. Cars are then matched with buyers based on the selected location and the best possible offers are obtained.
“If they like the offer, all they need to do is test drive and purchase the car at the dealership,” says Cheng. “This way, we also help Carsome Certified Dealers by extending their reach to genuine car buyers and significantly reducing their advertising costs. On Carsome, dealers get quick and easy direct sales, and we only charge upon a success basis.”
In launching the business, Carsome had an initial cash injection from the two founders. Teoh recalls, “Our savings were used to build the first version of the website. That was all the money we had, which had to carry us through the first few months. We bootstrapped by keeping all of our expenditures low, even the personal ones.”
Subsequent investors included some big names such as Tan Sri Vincent Lee, the man behind many high-profile and notable brands in the market, and Khailee Ng, the managing partner of 500 Startups in South-east Asia.
The Carsome platform went “live” in February 2015 and has since experienced a near 100 per cent month-to-month growth according to the founders. Cheng adds, “Based on our data, Carsome users save RM3,000 off the retail price per car on average.”
How does Carsome get the best possible prices from the car dealers though? Teoh explains, “All offers from our certified dealers are pre-negotiated and exclusive to Carsome’s platform. In return, they get hundreds of thousands of qualified users ready to buy brand new cars. Carsome users go through multiple steps before contacting a Carsome Certified Dealer, resulting in deep-in-funnel prospective customers. On average, our users are ready to purchase within 28 days.”
As new entrepreneurs, Cheng and Teoh’s biggest challenge besides bootstrapping and raising money is building a solid team. Cheng says, “We were having trouble expanding the team beyond two of us but thankfully we managed to grow our team to six people now. All of us are doing a little bit of everything!”
Not to rest on their laurels, Carsome will be rolling out their new Sell feature this week. Teoh explains, “This involves reinventing the car selling experience in Malaysia since we already did the car buying part. All a seller needs to do is submit their contact details and we will schedule an appointment for a free car inspection by our experts. An offer will be made on the spot and if the seller accepts it, we will proceed to pay. The entire appointment will be within 30 minutes!”
Cheng shares that they’ve just successfully closed a round of seed funding so expect Carsome to keep growing with more features to be added soon for both the buying and selling platforms. “If all goes well, we will expand our services out of Malaysia by end of the year. This will be a revolution!”