Showing videos of used cars for sale

Showing videos of used cars for sale

Business Idea:

Making money by showing videos of used cars for sale.

Overview:

When Luke Thomas tried to buy a Land Rover online, he found the experience very frustrating.  Not only was the online and physical search process less than ideal, but also many of the cars he did find looked better in their photos than in real life.

Out of the poor experience, Thomas, who at the time was a Stanford student, decided to create Hotswap.com.  The site allows sellers to post videos of their vehicles, which can then be viewed by would be buyers.

The site is on track to have 11,000 listings by the end of the year and has also received about $2 million in funding from venture firm Kinsey Hills Group.

The market for the site is quite large and the revenue potential very attractive.  According to CNW Marketing Research, Americans spent nearly $358 billion on used cars last year, with a quarter of the sales taking place on the Internet. With the power of video, high quality video that is, buyers are armed with great information to make a good decision on a used car.  The site is hot because the videos posted show the car in full detail.  Every scratch, dent, and other imperfection is in plain view.

While the video listings are free, the site makes money by licensing video technology to dealerships and car manufacturers. It has deals with AutoNation and Enterprise.

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