Used car marketplace Motobyo is expanding its platform throughout the Northeast with plans to take it national as soon as 2024.
Motobyo was founded by George Lekas, a 30-year veteran of the auto industry, and Ron Averett, who has made successful exits with two separate companies. The two had an overlapping passion for tech, combining Lekas' auto experience with Averett's startup experience to launch Motobyo.
Averett, the CEO, described himself as someone who liked to get in and out of a car sale as quickly as possible, and Lekas, the COO, saw opportunity for the used car industry to lean into tech as a way to streamline used car transactions. They founded Motobyo in 2021, had their beta launch in August 2022 and are now looking at 2023 as the year the Horsham-based startup takes off.
The beta launch was limited to the 10-county Philadelphia region, but Averett and Lekas have plans to expand the platform outward from there. The goal is to have Motobyo operating in regions like North Jersey, southern New York, Maryland, Northern Virginia and Washington, D.C., by the middle of 2023. In about a year, Averett and Lekas will look to take the platform national, naming metro areas like Chicago, Charlotte, Dallas-Fort Worth, Atlanta and Tampa.
Depending on the growth of the platform, Averett anticipates adding five to 10 people this year to an existing team of 14.
The company has raised $2.5 million to date, along with a $1.1 million investment from its founders. Averett, who has experience raising venture capital, said the startup will look to open another round of funding in the second quarter.
Motobyo is an e-commerce marketplace that allows people to buy and sell used cars. It presents prospective sellers with an option to take a cash offer based on technology that determines a projected market price, or put the car up for a seven-day auction. The cash offer, calculated by transactional data and current market conditions, is a "safety net" that sellers can accept immediately or if their car doesn't sell at auction. It also offers buyers and sellers services like an independent third-party inspection, financing and insurance, titling, vehicle history and DMV services.
For January, the first month the marketplace has been available outside of the beta market, Motobyo expects to process 1,200 vehicles in the Philadelphia area. It projects pricing 2,000 to 3,000 vehicles across the region in February, when it plans to roll out additional offerings like at-home inspections and extended auction times. Averett said he expects volume to increase 75% to 100% by the end of the year.
The Philadelphia startup will be taking on established used car giants like Autotrader and Cars.com, but Averett and Lekas say their process is more efficient and not clouded with listings from car dealerships. Instead, all transactions are from one private party to another, and the cash offer ensures a timely sale.
"It's kind of the only platform that can say we guarantee that every car that comes, gets sold," Lekas said. "You go to Autotrader or Cars.com or some other alternative, they tell you that a private party car takes about 75 days to get sold. On our platform, it's 90% less."
