You see, I've never shared this before, first with you. But this is real, the journey that we mentor. This tech founder spent four years working for Elon Musk at Tesla. But after taking a two month break, he realized he wasn't done reshaping the automotive industry as we know it.
Today I'm speaking with Jay Vijayan, founder and CEO of TechYon, a multi-billion dollar tech company that's building a new type of automotive retailing platform for dealers. We discuss raising millions of dollars to reimagine dealership technology, lessons from working for Elon Musk, why he bought two physical car dealerships even though he's a tech company, leading without an exit plan and much more.
Don't forget to click subscribe so you never miss an episode. What's up everyone, this is Car dealership guy. You're listening to the Car dealership guy podcast, which is my effort to give you access to the most unbiased and transparent insights into the car market.
But before we get into the show, people ask me all the time, CDG, can you help me fill an open role in my company? Well, now I can. I'm excited to announce my new industry job board. I've built this job board set that employers in the auto industry can take advantage of my network and distribution. Your company needs roles filled and I have access to talent. It's a win-win situation. This job board is for anyone in automotive, vendors, dealers, lenders, manufacturers, auto tech, you get the point. The best part is that posting roles is 100% free. Over 50 companies have already posted open roles, including lithium motors, recurrent, credit acceptance, cars commerce, shift digital and over 20 dealer groups. Add your open roles today by visiting my website at dealershipguy.com and clicking on industry job board or visit the link in the show notes below.
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Software engineer product development was in one of the largest enterprise software companies in Oracle for almost 8 years. Building ERP product. I felt that time itself, like now, SAS and cloud are the future and someday I'm going to start a SAS company. I felt some of the large companies, including Oracle, are a little bit slower, naturally because of the large nature of how big they are in embracing cloud and moving. I felt that is a huge opportunity there. So that's kind of the seed of the idea and then moved on to VMware, which was, you probably know, the server virtualization space.
Phenomenal company, I joined right around their IPO, stayed there for almost 5 years, hypergrowth, learned a lot and then my entry into automotive first time was a Tesla. I did interview with Tesla in 2010 before their IPO. Long story short, I was very interested, very intrigued. Elon's vision on what he wants to do. At that time, it's different. You can imagine Tesla today. This is 2010. It's like, it's just prefetched, you know, dream, but I was quite, quite interested in entry. But the deal didn't work out for me. It was not attractive enough for me to live. So I, in fact, declined the offer from Tesla and I stayed at VMware.
Then after a year, I was approached again in December 2011. And meanwhile, I was following the company and they launched the Model S concept and I love the way the car looked and everything they've been doing. And, you know, then I met Elon again in 2011, December and he convinced me this time to jump in and where they are going. And I ended up as a tech guy to his vision was to build an entire platform for a brand new automotive brand like Tesla. So that was an exciting opportunity for someone who's a product and engineering, you know, background to build something for a new automotive company.
So I ended up joining Tesla. I still took a pay cut from a cash perspective, but I got more stocks, which I negotiated, which worked out. Yeah, right. So that, and I, yeah, I still, I mean, you know, he has built incredible value and I was headstone building the platform end to end, starting from, you know, which is today, just let me come to internal systems, ERP, you know, some of the factory systems and then store systems.
Honestly, I didn't come from the automotive industry. So I had a very fresh perspective. So I had this opportunity to evaluate what is happening in the automotive industry. So I was able to, you know, look at what's happened because as a consumer, I remembered multiple car buying experiences about Toyota, about BMW for myself in the Bay Area. It was a least to say a very horrible experience.
You know, I was a very well-informed guy. I go by data. I did my research to buy a BMW. I knew exactly what car to buy. I was willing to pay, but I still spent almost, you know, seven hours in a dealership with my wife, horrible, grueling experience. It's not that people, you know, intentionally were doing that, but the point was why in this day and age we should spend this much time. This was before Tesla. And then now I felt like, wow, I mean, there's an opportunity to transform, at least for one brand, I could transform this experience.
So now I studied everything, then realized how fragmented, which was a good thing for me. I didn't come with preconceived notion. For me, everything was a fresh perspective. But I was so surprised to see how much fragmentation existed. People were good. Their intentions were good in the industry. They wanted to serve customers. They wanted to provide best experience. And to be honest with you, they were dealing with very antiquated platform, very broken system. You know this well. You know, you're running, you run a dealership. To do a deal in the new car site, it's even more extreme. People have to open 10 different windows to do a deal. Whether you like it or not, you can figure out based on your level of expertise, you may able to conceal or patch up. Not revealing that to the customer, but the customer really sees it, right? Customers see that you're doing something that they don't trust because you have to do so many things to go through a deal.
So for me, it was very obvious. The problems were very, very obvious. So we were able to go list out everything and say, how are we going to solve every one of these problems so that the experience for Tesla is seamless, the Tesla consumers, the seamless. I think we did that. You're a Tesla at this point.
How do you come up with the idea for Techyan? What happens and why is it is it simply you say I've built this, you know, phenomenal software here. I want to go bring it to the rest of the world. Right. What was that driver for you?
Great question. So two things connected. Okay. So going back to my, I mentioned to you my article days that, you know, cloud and SaaS is the future and every business eventually have to move to the cloud and there's a lot of power in making it easy for businesses and consumers connecting to my dot. When I did my research on how big the problems of the automotive industry, of course, I had an opportunity and thanks to Tesla, thanks to Elon for giving me that opportunity. I would be able to solve that for Tesla customers. Then I felt, okay, this industry is massive.
You know, at that time, you know, Tesla is still growing up and it was a fraction of the industry. And I felt, wow, 99% of the industry is struggling without any kind of, you know, technology, modern technology platform. So that's the idea. So connecting two things. One, I felt automotive industry clearly jumped out to be served for my SaaS idea, you know, SaaS vertical. And I felt connecting the brats. I felt, okay, this is the vertical. This is the industry. I want to create a SaaS platform. There is incredible amount of value that we could deliver to the industry that's been underserved for decades.
And honestly, this was never many things in your life are as crystal clear as this. For me, it was very clear. Okay, this, this is the industry. I want to, you know, create and solve problems and create a business out of it.
And, you know, while people kept warning about the barriers in the industry, one after the other, right? Big, you, you may know this well. People want me about how complex it is to build a DMS, let alone a DMS versus building an end-to-end platform for automotive dealerships and entire automotive retail.
Second is, integrations was a massive barrier. People said, no, no, no, some of the big mammoth software companies have tried and given up. And there were examples. To create a deal of Shabbat's wisdom. Yes, yes, yes, yes. And some of the biggest software companies have tried in the past and gave up. Incredible, incredible, incredible.
One of the things people brought up is getting integrations done in the industry. There are like hundreds of integrations you need to be, you need to be completing. Before you can serve a dealership, the biggest ones are getting the manufacturer integration. So every brand manufacturer you need to get integration completed for you to roll out their brand dealership.
So what does that mean? If you want to truly bring a transformation to run a big dealer group or small, whatever it is, right? Especially if you are doing a big group who runs like 35 brands, which we have now, today as our customers, you have to have all the 35 brands integrated. Every integration points need to be completed and taught. This incumbents had decades to do. We did it. We did the whole thing in two to one of years. Every single brand. We're integrated with 42 brands today. That's unbelievable.
Tell us about, give us some insight to working with Elon. What was that like? What did you learn from Elon? I see the smile on your face already. A lot, a lot, a lot. To be honest with you, I was fortunate to work for him directly. So I had an opportunity to work with him. There's so much I learned.
So he extremely intends on solving consumer problems. Really no compromise. He doesn't take no for an answer, which now the whole world knows. But I think it is a lot of learning. I would say I'm thrilled eventually within like six months to a year after I built Trust With Him. One of very few organizations in the company, I think he will agree to it.
He was very hands off. He was very hands off. Of course, he would ask deep questions. But I think that showed that it gained his confidence that we can deliver to his expectations, which are at least to say super high. So I think it was great.
What did I learn? Extreme amount of customer obsession taking no for an answer in solving consumer problems. In the sense one important one I would say is he would question, which I did, even pre-empting every click to say does the consumer need to even have this click at this level. He would question every single click to remove friction in consumer journey. So there is so much learning.
And then the other one from a business side solving business problems. He would go, I mean, which the whole world knows, right? Of course, there are books on it now. Always question the fundamentals, right? You'll say, okay, when someone starts as like, okay, we can't solve this problem. He will keep drilling down until he gets to the bottom, the fundamentals of and then push whoever that is to start thinking from ground up saying that, okay, yeah, this, you can't solve this problem. If you just think only superficial solution, go back and fundamentally redo it, whatever it takes, even if you have to rebuild the whole thing, he will push to do it.
Tell us about your first deal at TechYan. Right? You mentioned something astonishing, which is it took you, so you've at this point, I'm kind of fast forwarding the new journey, right? You've left Tesla, you've ideated TechYan. And, you know, here you are, you've built, you want to tell us, so you've built an MVP.
And I don't want to, you know, I don't want to steer his thunder here, right? You know, it's an important story and share a short question. So please tell us about that story, because I want to understand the beginnings. I want to end the beginnings and that first, that first deal that you scored.
Let me start. It might be long, but feel free to interrupt, right? I think it'll be good for you to get the perspective.
让我开始吧。可能会有些长,但你可以随时打断,对吗?我认为你能够获得这个角度会对你有好处。
But I decided to leave Tesla and, you know, started my own company. People thought I was crazy. Even people in my team thought because I was one of the very few executives who established very strong trust. Elon, I was able to build everything that the company needed almost, I would say, everything. But yes, we really brought that vision to life. And people thought I was crazy. Like, why would you leave?
In fact, there was one of my direct reports in my one-on-one after announcing I was leaving. Thought I'm going to work for some secret project for President at that, the President of the United States. And he said that, Jay, that's why you're not telling why you're leaving and where you're going. I said, no, no, no, I am going to take a break, which I did.
I did take, you know, few months break, which I used to do a lot more analysis. I met a lot of dealers. I met a lot of OEM executives. I did tons of research before really jumping. And then I jumped in, started the company, started with my personal money. And we started at our, you know, at my garage. We had a few people, you know, four people, including myself, and then shifted to my home office. And then eventually we found an office after several months.
And then the thing is, we had a very clear vision, you know, not to your scale, but we were in stealth mode for almost, you know, three and a half years. We didn't reveal what we were doing. Not many people knew about us. We were head-stown, focused on developing the product.
And then the idea was a few things. We took, you know, a few steps to get to an end-to-end platform, because people clearly said, building an end-to-end platform, a PMS, CRM, whatever you call it as, you know, people call specific product names because the core product left a lot of gaps that was filled by many, many other products out of need.
It is okay, it's all good. There are some great companies doing some great things. But the customer workflow needs to be understood cleanly and we ended up developing. The first product we launched, we called us Digital Service Experience, only for service module, service for dealerships. Okay. So that was your wedge. You started only with service. Exactly. 2018.
But here's the deal. It was, you know, funny learning, funny in the sense it was hard, but in the sense I learned the problem. So even for service, what happened was it became a massive chicken and egg problem. Okay.
So we created a prototype. We showed it to dealers, you know, through my kitchen. Every dealer who saw it was quite excited. They were like, wow, this is cool, man. This is like, you know, I would definitely use something like this. But now they said, unfortunately, my manufacturer needs to go, to certify this product.
And then, okay, I go to manufacturers and, you know, of course, because a little bit about my Tesla, you know, CIO, brown people are at least able to give me time for a meeting. But manufacturers, very honest, very clear. They were like, okay, you know, unfortunately, we are so busy. We have so many things to prioritize until you have 50 or 100 dealerships, 100 would be a good number. Unfortunately, we can start any kind of integration work. So you could see the chicken and egg.
So a dealer says, no, wait, I can't roll out before my manufacturer certifies. If you go to a manufacturer, they say, I can't talk to you until you have 100 dealerships. And then, yeah, there's one more caveat in a curveball where, oh, you need to integrate with the existing BMSS. We were okay with that, to be honest with you.
But I'll be very honest, the existing BMSS, when you go to integrate with them, they give you a contract that says almost you, you know, right off your first bond child to them, where basically you could never compete with them ever in the future. So we decided, no, we are not going to sign that because we know there is a vision we are working towards. We are totally open and integrating. We have an API. Again, you see, I've never shared this before. First with you.
But this is real, real, the journey that we went through. We had to solve this problem. You know, end of the day, we are committed. How do we come across all of these things? So we had to do a lot of, you know, one compelling compelling because end of the day, incremental is not enough.
You know, this industry, you can't show just incremental to break through these barriers. Whatever we do has to be super compelling for them to say, you know what, I'm going to make an exception for this. So that's kind of how we started. We went really full force, you know, building some of the best solutions in the product.
God, the dealers excited have the dealers start calling their manufacturers, get the manufacturing executives who are in charge of, you know, dealer networks, get them excited, showing no, no, no, no, this is not something we are going to. Just solve for a dealer. This is a big value for your brand consumers. This is going to solve the consumer problem and the dealer problem. So now then they started opening doors. So it took a lot of effort.
Everything from innovation, perseverance, knocking doors, you know, breaking barriers. Who was that first? Who was that first that gave you the opportunity? General Motors was the first who gave the opportunity and then followed by at that time, you know, FCA, which is Fiat Chrysler, that time now it's Atlantis. And then many others, you know, followed. Like I said, the first was General Motors definitely thanks to them and they saw the vision end to end.
And it didn't happen overnight. They followed us for almost two years before making any kind of decision to they will check in every six months. Like, what are we doing? Okay. How are we doing? How many dealers? Then we also started building confidence with General Motors dealer network, which also had other brands. So slowly that network effect started expanding, expanding. And we focused heavily on, you know, building and showing value. And that's something I'm proud to say you talked to our dealers. One thing they'll always get excited. In fact, one of our dealers recently said Jay, every month when Taehyang, you know, does it release? It's like Christmas for us. We've never seen a feature asking a lot of different figures. Yeah. Yes, new features, all the cool things. So it's been, yeah, it's been a fun journey. Yes. It's an incredible store.
I mean, who was the first dealer? I didn't ask you that. Yeah, yeah, yeah. There's a dealer in California called us California, automotive retailing group. I think they have 20 plus dealerships now. So that was the first dealer and then there's immediate. So we did three pilots, California automotive retailing group. And then the East Coast, we have ingersoll auto and connect it. And then you have one in Florida. It's a Chevrolet dealership. I think the dealer principal's name is Charles Winton. So there are three dealers. We again, we consciously did three pilots of the full end to end platform. California East Coast and South right in Florida. And then the way truly the platform works for, you know, different counties, state district tax calculation, operations and everything.
Now, at this point, were you were you still only service when you started expanding or were you already a full service in October, 2018. In July, we started doing pilots for the three stores with full end to end platform. So that was always in parallel that was going on. But we launched with all the challenges that was going on. We felt it's not worth it to even investing in this because barriers were continuing to be continuing to be bigger. And we said, you know what, if you're going to put this much effort, why not put it on the entire solution. So we went all in, literally all in and say, we're going to go develop this.
I mean, it's a long, so there are a lot of people advised, we are taking too much to buy it. It's too complex to too many things can go wrong, especially in building and accounting module and, you know, all of these things. For me, that is very clear. We will not be another, you know, thousand and one of thousand point solutions that exists. If you're going to solve this problem, we're going to solve this comprehensively for our dealers and for the automotive retail industry. So we went all in. It was a highly risky proposition, to be honest with you. We could have run out of money at that time itself, because we took massive undertaking to build a DMS and then we got it done. And we continued to hail from that time onwards. Two thousand, twenty onwards. It was just a full launch, GA and kept rolling out dealers.
And one of the dealer groups, I would say, I want to definitely call out, I always, you know, respect for their brand name. But these has been incredible partners. First, enterprise group of 30 plus dealerships that signed in 2020 was Berkshire, automotive in Wisconsin. You know, honestly, the best operators I've ever had, one of the very few, you know, high integrity, phenomenal dealers, Mr. John Bergstrom and his son Tim Bergstrom. Today, they bought more dealerships. I think almost up to 39. I'm not being accurate in the exact number. Everything runs on taking on every single dealership. Wow. Why do you think they gave you that first shot? What do you think got them over the edge? Well, I few things.
So one is, they attended my, one of my half a day presentation on a product demo. They truly got excited because they've been in this industry for, I think, 40 years. They've seen everything. I think, like I said, all the things that we did, I mentioned to you, putting an innovation and delivering a product that is compelling with value. They saw that clearly and they did a lot of diligence, spent time with us, everything, including, you know, data, of course, as you know, dealers are worried who wants the data.
We said like playing and simple. There's no gray area. There is no black and white dealers. You own the data. We make our agreements the simplest. In fact, Tekyans agreements is the simplest compared to even SAS. Of course, more simpler than any other DMS agreements here. We keep it very simple dealers own the data. We license the data as your tech platform to run your operations. So they allowed every part of it. And then second, of course, they've been very tired of the incumbent players. They've been doing that for a long time.
And then finally really leapfrog the technology. They're very innovative from thinking perspective, progressive dealers, how the industry is moving. They want to be in the forefront to deliver the best consumer experience, provide the best for their staff. And that way they can serve their consumers, you know, across Wisconsin. It's fascinating to tell me about what was the most shocking thing that you learned as you were building this. And, you know, you became a fully comprehensive dealership management system. Again, very, very big undertaking. I mean, you mentioned building out an accounting suite. I can't even think about the first step to building out an accounting suite.
What was the most shocking thing you uncovered about the current way dealerships were operating their dealership management systems? And a shocking thing is, you know, it might be obvious for you, but when you drill down the amount of fragmentation that exists in the dealership industry, really dragging their business backward. And honestly, they've been relatively, they knew their own, they want to move, but there are many dealers. I feel kind of got desensitized to it.
What do you mean explain that? Yeah, I'll explain to you, right? They're okay in because they put 20 band-aids because their staff have learned how to punch in, you know, 150 key codes and open 10 windows and still do a deal. They feel, you know, what I think it's fine. It's painful. At least it works. The second reason is they've had a horrible experience in their past, some time in the past, migrating DMS. So, you know, what taking on this is so painful. I would better just live with what I have, even though it's painful.
Some of them, not all of the dealers have come to terms. There are many dealers who feel like, you know what, enough is enough. I need to change because if I don't change, someone is going to bring the change to run over my business. So many dealers embrace change. I think there are many dealers who are really coming to terms. It is not as painful, especially migrating to Taguyan because now we've got migrated over 1000 dealers. It's not as painful. Some of the largest groups now, as you know, we announced the partnership with ASBRAE Automotive.
Overall, I feel the value that we deliver from a dealership perspective, you asked like, you know, why they are okay with the fragmentation. That's number one where they said like things are going, okay, past experience was painful. So I may be able to just live through this. But you know this well, how fast auto mode of industry, more than anyone you see, you know, you're there, you know, pulling, crunching data and pulling information. Industry is evolving so fast.
So now is the time to change because otherwise people who don't change will have a very difficult time in kind of being relevant for the future. So I think that is the most important aspect why sometimes people think twice on change. But the good news is when you explain to them and show them they're like, oh my God, wow.
现在是改变的时机,因为否则那些不改变的人将来会很难保持与未来相关。所以我认为这就是为什么有时候人们会对改变犹豫不决的最重要原因。但好消息是,当你向他们解释并展示给他们看时,他们会像"Oh my God, wow"一样惊叹。
Okay, I'll tell you a simple example. So one is booking a deal. Okay, you just close a car deal. You have to open, you know, 12 different windows, talk to five different people. And then you have to jump through hoops to close the deal and think about customer experience on the other side because they see through it because today's world, you know this. We all interact with all of these e-commerce companies which are doing amazing. You can do pretty much everything digital. I'm not saying I think that's an important factor to understand. I'm not saying the entire car buying will go online. I don't think it'll ever go online.
I'll tell you why. Interesting. Go ahead. Yeah. Simple example. So let me ask you a question. It's very obvious. You can buy every single Apple product online. Correct. Every single Apple product, everything, my Mac, the biggest Mac to phone or iPhone. So, but why is there a crowd in an Apple store? Right. And they open new stores. Apple keeps opening new stores and the line is a mile long when they launch new products.
So what does that say? Consumers still want to touch and feel their products, especially even if it is a few thousand dollars, you know, Mac or a thousand, five hundred, two thousand dollars iPhone. Think about the twenty, thirty thousand dollar car. Why wouldn't they want to touch and feel? Why wouldn't they want to do a test drive? The biggest issue in our industry is your experience from online to offline completely changes. They don't get the same consistent experience. So that's exactly what it is. My view, I am fairly confident about this. I may be wrong, but consumers are not asking, give me a full digital online buying experience. What are they asking is, leave it to me. You don't tell me how I should shop. Isn't that right? Like, that's exactly what I mean.
I took a, I took a fifty million dollar lesson learning that the hard way. So I think you are just on the gear. Right. See, I strongly believe in that. That's exactly why I gave Apple example because they connect the dots between online and in store because it's the same products, the same price, things don't change. So if you give the same experience and they sell more, they upsell, cross sell tons, accessories, you buy everything, headphone, all kinds of things. So now why can't we do that in the car industry? If you connect the online and in store seamlessly, consumers get the same experience.
That's exactly why I feel car buying is never going to go hundred percent on. Yes, the percentage of online shopping is going to increase. But if you connect the dots, consumers, all they are asking is, I'll tell you a simple, you know, my 20 year old daughter, how she shops versus how I'm going to shop is going to be different. So you need to make sure that consumers are saying, leave it to me. Just give me the same experience. Doesn't matter where I start, where I end. I should be able to start online or I should walk into a store, do a test drive and go back and complete my, you know, deal buying from the, you know, comfort of my home. So that is the key. I feel technology can bridge that from online to in store or in store to online. That is what we are working to solve.
When you explain that to the dealers, you know what, you need to bridge that gap. You need to make sure your staff and they come to the store operate in a efficient way. They don't jump through hoops to solve a consumer problem. Create trust. You're going to sell tons. And we have AI and machine learning that will enable you to upsell and cross a lot more. That is a lot more relevant for the consumer.
Did you believe the same thing when you are a Tesla or is this something that's been more recent for you in terms of the, you know, the shift to online versus in store? I believe the same. I believe the same from that time to today. That's why I just love you work, you know, to make sure that the in store experience is good. You know, I can speak for now because I left in 2016, which is almost eight years.
Oh, I don't know eight years. But at that time, yeah, you know, give connected experience. Doesn't matter all the way online, offline, in car, just make sure that you give a complete connected experience. You know, one of the things that I was thinking through when I was preparing for this episode was the fact that when I remember first looking into techy on and seeing that you don't like need a server room. And I explain that. Like when you saw that for the first time that dealers right for anyone that's not familiar, right dealers have these server rooms, right? Because a DMS, you're shaking your head. It's useful on the first dealership that we transformed. You know, my team took a picture of their server room and after techy on how this man, you will appreciate that. It was what was that? Yeah, what was that like for you? The idea of putting a dealership manager system in the cloud.
Was that novel? Were you the first to do that? Yes, we were the first cloud native platform cloud native DMS in the space. I think even today, I don't think there's anything that exists after eight years since we started.
Now, as you say, well, what benefits tell us about that? Like, what are the differences? Why should people care? Huge, you see, big time. In fact, today's world, I would say it's a necessity because of the security, you know, all of these social engineering, everything from a spyware, malware, ransomware. It's just crazy to be honest with you.
It is a necessity to take because I still remember and I think it happens today where there is a big server room. If you could imagine, of course, there are dealers who can afford to have an IT team. There are dealers who don't and it's a small operation, but they have to hire a consultant and sometimes they do a good job and they have to, based on his part time, he will do only what he can. The second problem is you literally expose the dealership for massive problems.
I don't know if you heard and I've heard from many dealers indirectly and directly that they were under ransomware attack. Literally, their servers start, you know, lock. Cyber security threats and hacks are there. I'm not sure if it's all time highs for dealers, but it's definitely increased. And that doesn't happen on the cloud because the reason is you're leaving it to a chance to one person who does it part time in some cases and old, un-updated servers.
And as you know, well, in the dealership, you can, if you all, you know, have some software outdated, you click on a link by mistake. It downloads to your, you know, desktop, the disconnected to your local server. So they just go and hack and lock your local hard desk under your server. And you can't, you know, get out of it until you pay ransom. That doesn't happen because you have professionals. You have security tools.
In fact, you see, we have the highest level of privacy and security certifications in the industry. And I don't think any other PMS has this. Sock one, sock two, type two certifications. We recently got ISO two ISO certifications, one for privacy and one for security. And I'll be happy to share details and this is factual information to be able to look up and dealers and we created something called as trust portal. You can go to techion.com slash trust. It just literally shows what we are doing for security and privacy.
While there are so many other benefits, of course, overhead of not maintaining a server. And being more comfortable sleeping peacefully in the night so that you don't get hacked. And there are so many other benefits, everything from, you know, performance on the cloud. Information is not last if your power is down. That's another good example. Practical example.
So today, at a, even at a techion dealership, if the power goes down, you can use the mobile phone to check in your customers. Your service drive doesn't have to stop. You can still the service advisors can use the mobile phone 5G to start checking in your customers. Everything goes directly to the cloud.
Let's dig into that for a second. So how are you, how are you actually building tech for dealerships? And the question, what I'm trying to get out here is, are you building tech around current processes? Or are you truly trying to, you know, look ahead and figure out what is the trend or what's the next, you know, what's a better way to do the things? How are you really going about that?
Both. First is we have a very clear, you know, the bigger picture problem to solve. So we have a roadmap saying like we need to keep pushing the envelope, right? As I said, three big areas of consumer journey. Okay. Number one car shopping and buying. Okay.
So we will keep pushing the envelope on that. Like how do you make that better and seamless and seamless? I launched one additional product at an ADA in my keynote speech. So you see it be helpful.
I know how busy you were. I'll send you three links. One is my keynote speech is around 20 minutes. I launched two new products. One is in this space exactly the advanced retail. Second is generative AI. So this is the second generative AI product we launched. And I also talk about how much we have invested in AI from the beginning. And how we are investing in generative AI now context specific to generate value for our dealers.
So two broader teams, I would say the first one is the consumer journey. So three consumer journeys, car buying, shopping and buying service and maintenance, which is vehicle service and maintenance. Third is consumer engagement. Engaging, right? It's CRM. Engage with your dealership doesn't matter how you engage. You can buy a car, you take it for service or you can even buy an accessor. Still an engagement. So you want to make sure you connect the dots on the consumer journey seamlessly. You don't need so many hops and things fall through the cracks. See, you know, today's world, I've been there before. If you walk into a dealership for the seventh time and if they ask who you are and your phone number and email, tell me how upset you're going to be. Right? I will be right very upset because today if you go to an online e-commerce site, they remember you one time you would have visited two years ago, let alone you visit two hours ago. Today, you know, it remembers you. But if you walk into a dealership, so my point is it could be from any channel they come. So these three consumer journey is the first team and these three are the core consumer journeys that we always work towards solving. Right?
And then the second is dealer feedback from the business. So we have three ways we get feedback from dealers and we literally pay attention to it. We listen, we act, we deliver. So first is we have dealer counsel. We meet with dealer counsels, dealer principals and general managers. They are product counsel. Every dealer operational area, you know, sales, service, business and parts, accounting. So every dealer operational area and digital as well. We have a product council. Third, most innovative. I don't think any other DMS company has it. From our product, you don't use it. You will see live user sentiment. Every user has a voice in the product. There is a button to give feedback. One click, they can say, how are we doing? What do they like to see more on tech? We have a very nice workflow engine to get that product feedback. We have a dashboard and then it goes all the way to our product team and they use that to prioritize our product enhancements. So that's kind of how we do. You're tracking sentiment real time across every single user.
Interesting. How do you adjust that data? What do you see on your end? What's the feedback loop there? What does it look like? Yeah. So the feedback loop is, you know, it's cool. Most of the time it's really, really cool. We get like, you know, recognition. There are times, you know, we get someone comfortable feedback, which is okay. Honestly, I feel especially coming from our source. I tell my team, guys, this is a gift for us. Literally take that feedback. Let's go work on it. And we take if there's 100 people who are complaining about, like, you know, what this feature and parts of all cell function is not working great. You guys suck at it. Then we take that and say, okay, I'll tell my product lead. What are you doing about it? So in my product reviews, I'll see. Okay. There is a roadmap item. We are going to solve it. Honestly, some of those people literally turn around when we launch a feature the next month, solving that problem. We can see from the feedback also. They get thrilled. Holy shit. I mean, you guys really delivered. You listened to me. So which is a powerful, powerful thing when you listen to your customers and you deliver. So yeah, we have a very clear workflow that goes through. We have a dashboard. Every team tagged by which product, which module, what problem the customer is facing. And then I have in my product review to say, how are we mapping our product prioritization and then how we are delivering back to our customers.
One of the early stories I loved was that you actually own the dealership. You purchased a dealership for TechYam, right? Like a physical dealership, two of them. You don't have them anymore, right? We are almost in the final stages of closing that up. I'm selling that. So I love that, right? Like talk about eating your own dog food, like really being there in the nitty gritty. Like, why did you decide to do that? When did you do that? Get, tell us about that process.
The way I thought about this from the beginning, right? We are strong product technology minds. We wanted to solve a big industry problem. We don't want to be kind of very, you know, naive or even arrogant that like we are tech guys and we know everything. So we needed to spend time and I started spending time and thanks to some of our dealers and as I mentioned to you, the first dealer in the Bay Area, he literally gave an office in his dealership to us saying that we love what you guys are doing. Your team can spend time. So we started talking to their staff, how they operate, right? We wanted to do a full paradigm shift. So we studied a lot about dealership. I hired a lot, a lot more people from the industry. So it's a great hybrid. So we have a phenomenal product people from the tech industry. I hired a lot of people from the industry, from the automotive, from the dealership industry into the company. So great hybrid.
Now, I felt like, you know what, we are nobody to go tell a dealer how to run their business using our software if we don't know how to run a business. So I felt this was an opportunity for me and my team to learn about dealership operations. This was in our December 2019, okay, when we launched the first dealership pilot. I came to know that dealership is that particular rooftop is going up for sale by the owner. And I felt, wow, okay, this is an opportunity to buy that dealership and make it as a lab so that we can launch the latest and greatest first.
There are a few reasons. First, understand the dealership business deeply for me and my team. Second, we don't have to go, you know, I felt it is too bad to disturb a customer all the time asking, hey, can you go look into this? Yeah, you can only, you can only get so much of your clients. Well, they've been very gracious. Our partners have been super gracious to give us time. There's only so much time you can get. Only so much you can do exactly. So this I felt is incredible for us, for my team to go on, for me, I can give specific targets. In fact, our zero contact concierge you will see in the product video, which I'll send you, was born from that dealership out of me because we saw that.
And while it was very tough, COVID hit and we were like, you know, we didn't, by the way, we did it. I think maybe we may have raised our series be or we didn't, we didn't have a lot of money as well. We asked you, I had to put my personal money to buy the dealership land. And what year was this? What year was this? This was in 2019 end. Just few months before the COVID thing happened. An entire peak. And what brands did you buy? General Motors and then Hyundai. Okay, well, he probably made a nice little profit there. Yes, he did. Yes, he did. To be honest with you, it worked out phenomenally.
You know, one is profit, but honestly, exponentially worked out to create a phenomenal product. My team has a full act of course, like that's, that's of course the goal, right? It was to create a better product. Yeah. And that is exponential value for the size of, you know, who we are as a company, you know, how far we are growing. The value is a match. My team would launch new products, new features without any doubts to that to dealerships first. And then once, and we'll have, you know, people there and I have dedicated one person to do QA testing there. In addition to the users in the dealership and we incentivize the dealership users to give feedback. And then instantly the feedback would go on to the product and then we'll do a GA launch to rest of our dealers. Incredible value.
And, and honestly, when I first make the decision, I still remember, you know, closed, you know, in a conference room, I announced it to a few of my direct reports. I got, you know, mixed reactions, all good intentions. One of the executives who came from the automotive industry, who was my direct report was sharp. He was Jay. I know you're very smart, man. You're, you're good. I've been in this industry. This could go horribly wrong. Please, they're better. Let us not. Because he said, like, trying a dealership is not easy, especially, you know, you know, the whole flooring and everything. There's so many things that could go wrong. And the last thing he also said, if dealers would may consider us a competition, what would happen? I said, why would that be, you know, it's okay, you know, we are doing it for the right reasons. To be honest with you, who's the reverse in conversations with dealer groups, I, they love it. The moment you mentioned that you own two dealerships, you could see in their eyes and some even called out saying that like, Oh, okay, I can talk to you because now you know my business. So it was a very positive thing. In fact, no one ever thought we had a competition and that worked out phenomenally well in every case. And it was not an easy decision. I was a bit nervous after all the warning signals people gave me.
And then I still decided that I think that I would go make the decision. And then I think a testament going back to, you know, you mentioned earlier, like first principles thinking, I just think it's a testament to that, right? Like thinking about it. Hey, I'm building a product that's meant to serve this business. If I can't, you know, be there to really experience it. I mean, or it just, that's the way to create the best possible product. I think I think it's super smart move. And I'd have to imagine that the reason the reason you've sold them or are in the process of selling the final one is because, you know, you're at a different scale and size now and this is much less. Product is true. When we don't need a lab anymore, we have, you know, hundreds, now 1000 plus customers, we get enough feedback more than enough via all channels. And honestly, we didn't want to distract ourselves, you know, running a dealership is even though we didn't run it today. We retain the same operator who wasn't running it before. And now we felt like, you know, it's fine. It's okay. We did what we needed to do. The code purpose is more than solved. Fine. If someone else was a professional who wants to run a dealership can run it.
It's funny because when you said that like products is proven with thousands of dealers, I thought about, I thought about sort of cardielship guy and how when I started, I was just sharing stuff from my personal experience. And whereas today I have like hundreds of people sending me stuff, sending me information on a daily basis from big and small. And it's like very, very similar in that sense, right? That like my experiences are, you know, 1% of the content today, whereas they used to be 100%. And the 99% of the content truly is from the industry, from every other person that's operating day to day. And so just much stronger as a business as a platform when you have just a bigger, just a wide array of clients to work with. That's right. I mean, it is, you know, you're right. Very similar.
It was heartwarming, to be honest with you, while our demo stations were overflowing at the NEDA, we had tons of our existing customers stop by and wave about. In fact, they were ready to go and speak to potential customers, big groups, big groups. You know, Bergstrom, Bob, you know, Mr. John Timbuxchum after three years, you know, still they stopped by to say, hello, you know, Roman group, Ryan Roman was there, like, you know, 20 plus. We have multiple dealer groups, Autobahn, they were there. I mean, our customers, it was so heartwarming for them to stop by and say nice things. Of course, there is certain times they last for a feature and, you know, can we get this? But overwhelmingly positive feedback, right? You know this more than any of your customers and for you, your listeners and your followers, you know, giving you great feedback, it's always feels, okay, you know, what I'm doing the right thing. Maybe I need to know.
Yeah, I, this is the stuff that's, you know, so I want to flip it, because I have some thoughts in my mind, but what do you think takes to create that kind of connection with your audience? From your perspective, why do you think people stopped by your NADA booth at the convention in Las Vegas the other day and, and acted like that? What is it?
Yeah, you know, I would say the genuine reason is we truly, truly empathize with our customers and we listen and we act. And they know that. And it's not like we see actions, you know, this act actions prove a lot more than words. So we don't just say that. We show it a lot more in action. I feel that's it. That's the way to best way to build connections and that's exactly what we are doing. And they truly genuinely recognize that and believe in that and believe in a very long term partnership and a relationship with us. Trust is the most important. It takes time to build. You know, once you build, you need to just make sure that you continue to keep up your word and show it in action and, you know, continue to maintain that relationship for a very long time.
Beautiful stated. What has your personal question? Yes. Does anything keep you up and I? Yeah, I mean, the thing is not not a lot after many, many years. I have a I have a routine that keep up. Key is more. Yes, what keeps me up is all about how are we going to scale gracefully to put it simple that one line keeps going back in my mind again and again. How are we going to scale gracefully? There is an incredible demand. I don't have any doubt in my mind that they're going to be super successful. They are successful now, but it's going to be even more, but that shouldn't make us complacent. We have to be on our toes to make sure that we continue to work towards taking the right steps to scale. So it's all about scaling. How am I going to make sure that from 1000 to, you know, 2000 to 5000 to 10,000 dealers? How am I going to scale the business very successfully and I've been taking steps and you may have seen, you know, many things, right? Product announcements to our focus. I'll send you that video. I think definitely you'll have an idea and whatever information outside of what I'm sharing here. Anything you want to pick it up from there? Feel free to hire some key executives in the last 12 months. I hired multiple senior executives just recent two ones are a CFO and a CRO. These are in our end of the day. It comes to people, process and systems that will help scale a business. So that's my focus. That's if anything I lose sleep over. That's it. It's about how am I going to scale the business gracefully?
I think I think many people are in your state for chairs and more sentiment and making sure you retain that customer experience and that personal touch, which has really gotten you here. Biggest errors of opportunity. What are we looking at when we look at the horizon? You know, next five years with Techyane. Where are those errors of opportunity? What are you and what are you most excited about?
First is, you know, quite excited about really transforming the automotive industry. When I said transforming, one thing I feel there's a few important things I want to state. I think you will get it. When I explain, there are people who get it. Obviously, there are people who get it once you explain and break it down. There are small percentages of people who don't understand yet is automotive is an ecosystem. You need to make sure that you create a win-win ecosystem for everyone. Win-lose is when someone else is going to take the business away. You need to make sure that you deliver what consumers are looking for, what modern consumers are looking for. That doesn't mean you have to compromise the business, compromise the profit, compromise efficiency. You can still do all of those and still making sure you deliver the best consumer experience. What do I mean by that? First, from a dealership operations perspective, you need to make sure that you put the horse before, not the cart before the horse. Some people still do that. Making it, okay, my team knows only how to do this this way. This is how they have done it and this is how it will be. Unfortunately, you are putting the cart before the horse. The horse is the consumer experience and consumer loyalty. If you lose that, you are done. Any business, isn't it? For me, my customer is the dealer, but another day, for them, their customer is the consumer. If you compromise consumer experience, consumer loyalty, retention, you can't be in business for too long. We explain that that's something we feel there is a massive opportunity. Automotive industry is evolving so much. Transforming the retail technology platform, I feel strongly not too far in the future. Ticchion will have at least 60% of the automotive transactions going through our platform.
I like it. Selling, servicing and engaging. Why is that the number? At least I said. I feel the opportunity is so big, to be honest with you, because we have underserved so much. Except for a few areas where people are innovating, majority are still doing lip service and not truly innovating or transforming. We are doing it. We are showing it in action. The opportunity is huge. I'm not saying there are others who won't do it. We strongly encourage fair, good competition, which will keep us on our toes. We truly encourage anyone who wants to do this complimentary and could do this. We'll strongly encourage and work with them. That's why we created a partner cloud. We continue to not only anyone who even competes with us is okay to go work on an API and integrate with Ticchion. It doesn't matter. There are many complimentary partners we work with.
Now, that said, the opportunity is bringing the OEMs, dealers and industry ecosystem partners, like insurance providers, F&I insurance, right share providers. There are so many who are providing to the ecosystem, software providers, bringing them together to create a win-win ecosystem, I feel, is the biggest opportunity. The past people in this space have been dividing and conquering. What do I mean by that? Kind of, you know, splitting each other OEMs and dealers and ecosystem partners against each other. To be honest with you, as I said, win-lose is the complete opposite of win-win. So we believe in win-win without compromising your priorities.
So as I said, there are some myths and rumors, you know, you'll see, I think it'd be great to break that and it keeps coming up. And when we break it, people understand it. Of course, I wish I can, but I can't be in front of every single dealer or OEM. One of the rumors is, oh, you know, Ticchion shares a lot more data with its OEM. Absolutely not true. In fact, it's the opposite. We give it in writing to our dealers. They own their data. We license it. And they have full control, full control. There are providers in this space who give it in writing saying that you don't own the data. Dealers, you don't own the data, we own the data. That's what they say. So we don't, we do the exact opposite. So dealers shouldn't have even the slightest doubt that they own, they are in control. In fact, we are in the process of providing a dashboard of all the data going in and out of their dealer ecosystem so that they have capability to turn on or turn off.
Okay. So that's what. So we're just unifying what I mean by that is today people are unfortunately fighting on the wrong things versus focusing on the customer experience, bringing the customer experience together, making sure you provide a seamless customer experience.
You're going to not only gain more customers, you can retain more customers and continue to do more upsell and cross sell using technology. And people today, we all know this believe technology a lot more than they believe people. It's unfortunate, but reality.
Well, beautifully said, man. Dude, this has been fascinating. I learned a lot for sure. And just man, the journey, the journey you're on, it's really, really admirable. So, you know, I think you guys are, you're doing great things. And it's really, really cool to see from the side.
You know, if you can leave us off with, you know, your vision for the company and, you know, for the future, I know off the record earlier on the conversation you were mentioning to me that you are here to build something durable for the long term, right? An IPO may happen at some point. That's all kind of, you know, financial mechanisms to keep the company growing. But, but what is that, you know, give us that like big picture vision that you have.
Thank you, Jose, for asking, you know, it's a, it has been a fantastic, you know, engaging and discussing with you. Very discussion. From a company perspective, as I mentioned to you before, truly from day one, you know, honestly, it's not, I'm not saying this for the interview. We can talk to any of my people who have been with the company for long enough. I've always mentioned we are here in this as a long term journey, long term journey. We deliver long term value. We are in this for a very long term journey.
We want to be, I don't know if it's a direct comparison. We want to be companies like, you know, Oracle and SAP from a durability perspective, Salesforce, companies who have been there for decades, continuing to deliver value. And we will be, we are already, you know, from a tech perspective, we have most advanced tech, even some of the tech companies, more advanced than some of the tech companies. And we are delivering value.
And as I mentioned to you, there are times where people ask me, you know, what's your exit plan? And I said, I don't have one. There's really no exit plan because I'm not planning to exit this because this is an incredible opportunity. And then sometimes people ask, when is the IPO? Then people during an interview process, if a candidate asked that to me, I clearly tell him, Hey, yes, it's a milestone. Sometimes it'll happen or it may not happen. But if you're joining for this, I said, please don't join. If this is the one reason you're joining, please don't join. It's okay.
Because we are in this on term, they get, they are a little bit shocked by the end of the day. That's the truth, right? If you're in joining for something short term, you're not going to build something valuable for long term. So I truly believe we are going to be here for many decades to come. So yeah, very excited about the future.
We are, you know, you know, this well, we are just starting. I mean, you know, the ecosystem is big. I mean, just the franchise, the dealer network, 17,000, if you add independent and others, it's much larger than if you add global, it's even bigger. We are literally crossing thousand. Think about the opportunity. We are excited. The demand is strong. Super excited about this company.
If you're going to be here, you're seeing looking forward to staying in touch and, you know, connecting back again. Whenever that happens, love to hear it. Jay, for John, thanks for coming on the pod. We're going to put the link to Techy on in the show notes below. So if anyone wants to learn more about Techy on, they can click on the link in the show notes below. Jay, thanks for coming on. This is awesome. Enjoy the conversation, you'll see.
All right. Hope you enjoyed that episode. Please give the podcast a rating. Consider subscribing to the show and check the show notes for links to what we talked about. Thanks for tuning in. I'll see you guys next time.