According to Technavio, the global used car market is projected to grow at a CAGR of more than 7% to reach 128.4 million units by 2021. The used car market in the mature EMEA market is projected to reach 36.03 million units by 2021 driven by the increasing aging population and rising fuel prices. AUTO1 Group is a Billion Dollar Unicorn that recently raised another massive round.

AUTO1 Group’s Journey

Berlin-based AUTO1 Group was founded in August 2012 by Christian Bertermann and Hakan Koç to change the way cars are bought and sold. It essentially aims to build a stock exchange for used cars, using technology to seamlessly connect buyers with sellers.

The idea for AUTO1 Group came from the frustrated attempts of Christian to value and sell his grandmother’s two cars – a Mercedes 190 and a Golf IV 1.6. Having just quit his job at Groupon, he was looking to start a new company. Together with Hakan, who had worked at Rocket Internet SE and Home24 AG, he decided to create an online business to address the gap in the used car market. In 2014, former Groupon SVP Chris Muhr joined them as co-founder and Chief Operating Officer.

AUTO1 Group buys used cars from OEMs, dealerships, and its own business units and sells them into its global dealership network. It also buys cars from individual sellers based on its own inventory and that of dealerships and manufacturers that use its platform. Prices are determined by its proprietary CORE pricing algorithm. The entire service including inspection and valuation is free of charge. It then sells them to dealers for a higher price.

Auto1’s differentiation from other dealers is that it uses its own cash to buy and store the cars until their sale to dealers. This speeds up the process for sellers from an average of 90 days in Europe to about 10 days.

Today, it operates in more than 20 countries, has about 320 branches, and over 30,000 car dealers across Europe. Germany was its largest market accounting for about 35% of its revenue in 2015.