Shift rode into the D.C. metro area in January 2016 with plans to invest $20 million into Northern Virginia's economy, hiring about 100 engineers and other technicians at its 1776 Crystal City space. Now, as TechCrunch first reported, the car sales platform is pausing its D.C. P2P operations and has laid off 10 percent of its staff companywide.
The company is pausing its D.C. operations while it works to close a dealer license for car rental company Hertz to act as a reseller. Under the partnership with Hertz, which was announced in December, Shift will resell cars on its platform from Hertz's inventory, indicating a switch from its traditional P2P model to a Hertz-dependent structure.
A Shift spokesperson told DC Inno that they hope to have the license by early spring and that the company's D.C. office is still functioning full-time, with only a handful of layoffs in that office.
Traditionally, Shift is a sort of intermediary for those buying and selling used cars without going through a dealer. The company reviews and tests out potential used cars that a driver is looking to sell, and once it passes a rigorous check-up, the car is placed on Shift's online car marketplace. From there, Shift handles all paperwork, test drives and arranges pick-up between sellers and buyers. Sellers receive a minimum sale price with an additional profit split between the seller and Shift.
The news comes about a month-and-a-half after its close competitor Beepi shut down all of its operations outside of Los Altos, where the company is based, which included its D.C. operations. Beepi then merged its remaining operations with Fair.com, a venture launched by former executives from BMV, Mercedes-Benz and Tesla.
Shift started in 2013, and since then, it has raised $74 million, closing a $50 million Series B round led by Goldman Sachs in September 2015. Its existing operations in San Francisco and Los Angeles will not be affected.
Image used via CC0 Public Domain — credit jan3933
