Used cars from leasing and rental companies were being sold at physical auctions. Kelly realized the wholesale side of selling used cars was ripe for transformation and started OPENLANE, a digital auction for fleet owners to sell their old cars.
Kelly raised money from some Silicon Valley venture capitalists and went on to grow the company to more than $100 million in sales. Despite having to give up the majority of the business to investors, Kelly and his partners still had a sizable chunk of the company.
Having started his business while still in school, a big chunk of Kelly’s wealth was tied up in OPENLANE and he wanted some liquidity. That’s when he decided to accept an acquisition offer of almost $250 million for OPENLANE.
In this episode, you’ll learn:
- How to raise venture capital
- The difference between a “seed” vs. “A” round
- A controlled auction and when to use one to sell
- How acquirers use the build vs. buy calculation
- The secret to deciding when to sell