Partnerships and Integration

Private equity funds find way into VSC space with deal involving APC Integrated Services Group

GREENWICH, Conn., and CHESTERFIELD, Mo. - 

Private equity money is flowing into all aspects of F&I, not just high-level technology involving originations, but also the potentially lucrative vehicle-service-contract segment.

Southfield Capital recently announced an investment in APC Integrated Services Group, a provider of consumer marketing of vehicle service contracts on behalf of dealers, manufacturers and other partner channels. A news release indicated APC’s senior management team including Kyle McEvoy, Ken Murer, David Diem and Todd Johansen will be continuing in their current roles.

Founded in 2000 by Ken Murer, a 22-year veteran of the VSC after-sale market industry, APC is headquartered in Chesterfield, Mo. The company creates revenue generating programs using advanced database marketing to sell automotive VSCs and ancillary products on behalf of dealers and manufacturers.

Through its multichannel marketing services, APC sells VSCs and ancillary programs directly to consumers outside of the point of vehicle sale for original equipment manufacturers, administrators and dealerships. APC has grown its VSC originations by a 54-percent annualized growth rate in recent years and nearly doubled its workforce.

“In taking the next step for our company, we wanted to find a partner that values our quality service delivery above all else,” said McEvoy, who is APC’s president. “We have taken the time to build APC through results for our customers, and we knew we could find that with Southfield.

“We very much look forward to further building our brand in the industry and to enhance our ability to serve the market with an end-to-end solution,” McEvoy continued.

Southfield Capital is a private equity firm that invests in high-growth, lower middle market companies in the outsourced business services sector. The firm targets companies with $4 million to $12 million in EBITDA and partners with management to scale the business through a combination of organic and acquisition growth strategies.

Southfield also owns Vanguard Dealers Services, Dealership Development and Centurion Automotive Products, premier agents and administrators of F&I products and services to franchised dealers nationwide.

Southfield partner Andy Cook commented on the APC partnership, saying, “Kyle, Ken, David and Todd have built an exceptional business around a core of highly skilled employees and a blue-chip customer base. APC has become the leader in vehicle service contract marketing through attention to detail and dedication to the customer.

“Southfield looks forward to supporting APC as they expand their service offering to better serve their customers. We could not be more enthusiastic to partner with the APC team as the business goes to the next stage,” Cook continued.

Colonnade Securities, a boutique investment banking firm that specializes in merger and acquisition advisory services, acted as the transaction adviser to APC. APC’s President, Kyle commented,

“We cannot say enough about Colonnade’s effort on our transaction,” McEvoy said. “They put in long hours and hard work on APC’s behalf. We could not have completed this process without Colonnade.”

Murer added, “Colonnade’s efforts to place APC with the right visionary partner like Southfield Capital, helps complete our vision to bring our greatly needed solution to the entire automotive industry. We now have the ability to expand our truly world-class end-to-end program as a result of this transaction.”

Lewis Rice provided legal counsel to APC. Finn Dixon & Herling provided legal counsel to Southfield. East West Bank led the funding syndicate for the transaction.

Auction Management Solutions hits two dozen clients with DAA Las Vegas add

PLAINFIELD, Ill. - 

Auction Management Solutions just added the largest independent auction in Nevada to its client roster.

According to an announcement on Thursday, Dealers Auto Auction of Las Vegas, (DAALV), has partnered with AMS for business development and other projects.

Founded in 2006, by Dan Thomas and Russ Norrish, the auction has grown to a 350-unit weekly sale with 200 to 250 attendees in the lanes, with additional online buyers utilizing the Simulcast platform.

The auction offers a full suite of services including transportation, reconditioning, and mechanical services. Thomas made the move to auction owner after nearly four decades in the industry, including leadership roles such as general manager and regional area manager with Manheim.

Norrish, an industry veteran, also held various leadership roles within the Manheim organization.

AMS president Tom Stewart said in a news release, “The wealth of experience among the senior leadership at Dealers Auto Auction of Las Vegas is impressive to see in an independent auction. They have surrounded themselves with employees that are knowledgeable about the industry and are dedicated to a high-level of customer service and customer satisfaction.”

DAALV, a National Auto Auction Association member, already has Lobel Financial, Enterprise, Avis and Honda Financial Services, among its commercial accounts.

“Las Vegas is a competitive market and we know that constant improvement requires keen insight into a rapidly changing marketplace,” Thomas said. “Knowing that AMS has assembled a team of experts that bring with them long-term relationships with vendors and consignors was a key factor in partnership”

Stewart pledged to deliver to DAALV results like AMS has for its clients that now number sits at two dozen after adding Alliance Auto Auction earlier this year.

“Our plan for DAALV is to build on their already solid foundation, by assisting them in enhancing their commercial accounts to complement their strong dealer consignment sales,” he said. 

CarStory announces FordDirect partnership to provide Market Reports to dealers

AUSTIN, Texas - 

CarStory announced Thursday that its CarStory Market Reports for used-vehicle insights are now available to all Ford and Lincoln dealers with a FordDirect website at no charge.

Ford and Lincoln dealers have access to CarStory's proprietary vehicle and market analytics tool, which uses the industry's largest set of inventory and shopper insights, according to the company.

“Dealers need the most innovative tools to stay competitive in the crowded market,” CarStory creator and chief performance officer Chad Bockius said in a news release. “There's just too much data out there to stick with the old ways. Shopping behavior is changing with the proliferation of mobile-first and consumers want answers not just more information. We are excited to partner with FordDirect to give dealers the analytics they need to turn browsers into buyers.”

CarStory said FordDirect joins Volkswagen, Hyundai and over 10,000 franchise and independent dealers, including OEMs and automotive marketplaces currently using Market Reports.

Autosoft joins NIADA as national corporate partner

ARLINGTON, Texas - 

The National Independent Automobile Dealers Association announced Tuesday that Autosoft has been added to its growing list of Bronze-level National Corporate Partners.

NIADA said members can now take advantage of special pricing to gain access to Autosoft DMS.

Autosoft offers both a sales and F&I module with inventory management as well as a full DMS option, which also includes accounting, service and parts.

Not only can the DMS give dealers more control over their dealership, but it can also improve customer engagement and operating efficiency and drive more revenue, according to NIADA.

“Autosoft brings unparalleled auto dealer-centric solutions to our membership,” NIADA senior vice president of member services Scott Lilja said in a news release. “Its longtime commitment to innovation and technology leadership in the automotive retail landscape fits perfectly with our National Corporate Partnership mission.”

In addition to providing comprehensive analytics, Autosoft integrates all workflows and communications across devices, allowing dealers to see and store social media profiles and indicate connections between customers.

The DMS also offers a mobile solution designed to streamline and speed up the sales process to increase customer satisfaction.

“We are excited to work with NIADA and its members to offer an innovative solution that has been proven to drive results for dealerships,” Autosoft chief executive officer Bryce Veon added. “From increased store traffic to higher service and parts revenues, the benefits of Autosoft will put dealers in a better position to succeed in a challenging marketplace.”

NIADA said Autosoft plans to introduce an export-to-QuickBooks feature that dealerships can use to create reports for individual or batch uploads to QuickBooks in Q2.

DealersLink lands more than 100 new dealer members in 5 states

BROOMFIELD, Colo. - 

DealersLink, a provider of automotive systems integration and networking technology, announced that it has recently expanded its geographic reach after signing more than 100 new dealer members recently in Arkansas, Mississippi, Alabama, Georgia and Florida.

Among the new clients are the following dealerships:

—Susan Schein Automotive, Pelham, Ala.

—Greg Orr Cadillac, Hot Springs, Ark.

—Ross Ford Toyota, Wynne, Ark.

—Rhodes Chevrolet, Van Buren, Ark.

—Steve Jones Chrysler Dodge Jeep, Wynne, Ark.

DealersLink created the concept of a dealer-to-dealer vehicle marketplace in the United States, wherein its members pay only a monthly fee and never any per-unit buy or sell fees. The company also offers dealership tools such as a mobile VIN scanner, retail analytics, new-car pricing tool with OEM incentives, live market pricing, inventory management and photo management. 

Last year, DealersLink estimated it saved its customers more than $21 million collectively, including $8.8 million in auction fees, $7.6 million in reconditioning costs , and $5 million in lot-ready-time expenses.

From its base near Denver, the company has continued its expansion into the West Coast, Midwest and Southwest regions, and this development represents the latest step in an eventual nationwide rollout of DealersLink services.

“The South is a great market for used vehicles, and we are extremely pleased that dealers in this region will soon be realizing substantial savings from using our Marketplace and services,” DealersLink chief executive officer Mike Goicoechea said. “The fact that our company was founded by and for auto dealership veterans also seems to resonate with many of our new clients. 

Santander Consumer USA invests in AutoFi to enhance mobile strategy

DALLAS - 

The proliferation of smartphones and potential buyers seeking financing at places nowhere near dealerships are combining to drive more investment into mobile platforms.

The latest development came on Wednesday as Santander Consumer USA announced that it will invest and work with AutoFi with the intention to streamline and simplify the vehicle-buying process for consumers, while giving dealers a robust digital sales channel.

AutoFi aims to connect dealers, consumers and finance companies to provide a more convenient, efficient and transparent experience when researching and purchasing vehicles. AutoFi’s platform allows consumers to lease or purchase a new or used car through a dealership’s website whether they shop online, in the dealership or both.

AutoFi’s network of finance companies provides consumers with a range of real-time financing options and the ability to customize their financing terms. AutoFi can then guide consumers through trade-in valuation and optional additional products for their vehicle. 

“Working with AutoFi is a win for consumers and a win for dealers,” said Rich Morrin, SCUSA’s president of Chrysler Capital and auto relationships. “Our customers get a faster, easier and more personal car-buying experience, and the technology facilitates a more streamlined process for our dealers.

"Santander Consumer USA’s digital strategy has always been about connecting consumers to cars they love and want to drive, with payments they can afford. AutoFi’s platform, along with SC’s digital platform RoadLoans.com, helps us do just that,” Morrin continued.

Santander InnoVentures (SIV) is Banco Santander’s financial technology venture capital fund, which will make an investment in AutoFi. SIV funds companies globally to support their growth and success, and connect them with Santander’s businesses to enable mutually beneficial strategic relationships.

Manuel Silva Martínez, partner and head of investments at SIV, on the investment in AutoFi: “Customers demand the same digital and ecommerce-like experience when buying a car as they do in other areas of their lives. AutoFi is enabling car manufacturers, dealers and car selling platforms to adapt to the changing customer needs, while building what we believe will be an industry-changing business.

“We are very happy to support AutoFi as we shape the future of the auto finance industry together,” added Silva Martínez, who will join AutoFi’s board as an observer.

Just a couple of weeks ago, AutoFi also landed an agreement with Chase Auto Finance. And now the FinTech firm has commitment from SCUSA.

“Santander Consumer USA has a clear focus on using technology to enhance the customer experience,” said Kevin Singerman, chief executive officer of San Francisco-based AutoFi.

“Working with Santander will help expand the digital market for dealerships, making it easier for a wider array of consumers to secure online financing,” Singerman continued. “Together, we look forward to delivering a convenient and transparent vehicle purchase journey.”

Another firm in this space — AutoGravity — also continues to build its relationship portfolio; this week collaborating with Nissan Motor Acceptance Corp.

Nissan’s captive joins AutoGravity

NASHVILLE, Tenn. - 

Add another foreign OEM’s captive to the list of finance companies now available through AutoGravity.

Nissan Motor Acceptance Corp. (NMAC) announced on Tuesday it is joining AutoGravity to help consumers looking to acquire Nissan with personalized retail and lease preapproval offers through digital credit shopping on their smartphones.

Through this collaboration, OEM officials indicated consumers will be able to select any Nissan vehicle and see finance offers from NMAC within minutes on their mobile device.

NMAC financing options are currently available on the AutoGravity app in California and will be available nationwide in mid-2018, according to a news release.

“NMAC wants to provide consumers the most seamless automotive financing process possible,” NMAC president Kevin Cullum said. “We use smartphones to manage many aspects of our lives, so it’s only natural for digital to be the next evolution in automotive financing.

“With our participation on the AutoGravity app, we are able to utilize this cutting-edge technology to connect with digital-savvy consumers and provide them with NMAC loan and lease preapproval options,” Cullum continued.

AutoGravity highlighted another milestone just last week.

The FinTech platform that leverages mobile technology to allow consumers to apply for financing said it surpassed $2 billion requested financing in 2017.

AutoGravity has built partnerships with many of the largest banks and financial institutions in the world, including key captives such as Mercedes-Benz Financial Services, Audi Financial Services, Volkswagen Credit and Hyundai Capital America.

And now Nissan’s captive is in the fold, too.

“Our collaboration with Nissan is another great example of how AutoGravity is bringing technology to the forefront of the car-shopping experience,” said Andy Hinrichs, founder and chief executive of AutoGravity.

“As the ‘digital glue’ that brings buyers, dealers and finance providers together through one convenient smartphone app, AutoGravity is enhancing the way consumers find and finance a vehicle — right from the palm of their hands,” Hinrichs added.

Based in Irvine, Calif., AutoGravity is using proprietary technology to revolutionize the car financing process by connecting consumers, finance companies and dealers through a modern digital marketplace. AutoGravity partners with leading providers to offer consumers convenience, transparency and choice, sending ready-to-buy users to dealers across the country.

The AutoGravity app guides automotive shoppers through an intuitive four-step digital retail process:

1. Select any make and model of any new or used vehicle available in the United States.

2. Browse thousands of vehicles by trim, color, body type and other attributes. The platform shows the closest dealers and inventory based on vehicle preference and geo-location.

3. Search for financing with smartphone simplicity. Users can scan their driver’s license and connect to social media to quickly pre-fill the application.

4. Receive up to four personalized preapproval finance offers in minutes and complete the purchase or lease at the dealership selected by the consumer.

AutoNation partners with Flexential to ensure IT stability

CHARLOTTE, N.C. - 

With so much of its business activity connected to technology nowadays, AutoNation made a move to ensure its customers can easily connect with its dealerships, and employees can complete work via the solutions they need.

Flexential, a hybrid IT infrastructure provider, announced the recent deployment of a high-density Disaster Recovery environment for AutoNation. The dealer group chose to house its DR environment within Flexential’s data center in Texas.

Combining the expertise of its people with state of the art infrastructure, Flexential said it helped AutoNation overcome a significant, time-intensive IT challenge faced by many organizations today.

“As a large enterprise, we recognize that investing in DR is critical to our core operations,” said Adam Rasner, senior director of IT operations and infrastructure at AutoNation.

“If our applications and data aren’t available, we can’t deliver for our customers,” Rasner continued.

Before turning to Flexential to fulfill its DR requirements, AutoNation moved its IT infrastructure into the public cloud. During testing, officials indicated that the dealer group quickly realized that its application and data needs required too much horsepower and were too expensive to operate in the cloud.

AutoNation recognized it needed a third-party colocation and DR provider with industry-leading power and cooling capacity that could accommodate its equipment within a small footprint to reduce costs. AutoNation toured several providers’ facilities, and ultimately chose Flexential.

“Flexential achieved for us what few providers could: a high-density DR environment at one of its newest and most innovative data centers,” Rasner said.

“The facility’s capabilities, coupled with the team’s expertise and flexibility, helped us take an original design of close to 20 cabinets at 5kW per cabinet and optimize that to seven cabinets at almost 20kW per cabinet — delivering the ability to scale our environment very cost-effectively as we continue to grow our business,” he went on to say.

To demonstrate this high-density capability to enterprises, the Flexential Texas data center features a test bed that showcases the ability to support high-density, hyper-converged server deployments. The facility is one of the company’s 41 data centers spanning the US, connected by a 100Gbps network backbone delivering network options and interconnection capabilities that extend to hundreds of global carrier offerings.

“AutoNation chose one of our most innovative and technologically advanced facilities, supporting density levels up to 2,000 watts per square foot,” said Tom Myers, regional vice president at Flexential.

“This is attractive for high-growth companies who require a small, dense physical footprint that enables them to cost-effectively scale their IT environment,” Myers added.

“We are glad our team and facility earned the trust and confidence of AutoNation,” Myers went on to say. “We look forward to helping support its business operations and enable further growth.”

Reviver Auto teams with Galpin Ford to sell digital license plates

DETROIT - 

Reviver Auto announced Tuesday that it has plans to place 100,000 of its RPlate Pro digital license plates on cars this year and that Galpin Ford will be one of the first to sell the RPlate to consumers in California.

This news follows the company’s recent announcement that it has closed $11.1 million in a funding round led by Australian-based ACK Group and made two additions to its board of directors.

Reviver Auto unveiled the RPlate Pro at the North American International Auto Show.

In addition to a sleek digital display, the digital license plate features functions enabling it to serve as a legal license plate and perform digital communications facilitated via a browser-based management system called RConnect, which was also introduced at NAIAS.

RConnect can enable automated DMV renewals, implement of charity plates in support of drivers’ favorite causes and support current, DMV-approved personalized plates that carry personal messages like “Don’t Drink and Drive” or “My Child is an Honor Student,” according to Reviver Auto.

“The license plate has not changed since Henry Ford debuted the Model T in 1908. Today, 110 years later, change finally hits the road as the RPlate Pro launches into one of the largest vehicle markets, and most technologically progressive landscapes, in the world, with more to follow,” Reviver Auto chief executive officer Neville Boston said in a news release.

“We are proud that the incredibly innovative Galpin Motors is the very first of what will be many customers across the U.S. who will help us bring our mission of greater connectivity and efficiencies to tens of thousands of vehicle owners and businesses.”

Prior to its introduction at NAIAS, the RPlate has been in use for pilot programs in both California and Arizona.

Additionally, potential cost-cutting benefits the RPlate offers businesses includes streamlined vehicle registration renewals, tracking registration compliance easily across vehicle fleets and the ability to create customized marketing messages that can be displayed on the plate when parked.

“When I saw the digital license plate from Reviver Auto, I thought it was absolutely awesome!” added Galpin Motors of North Hills, Calif. president and chief operating officer Beau Boeckmann. “Galpin has a long history of industry firsts and innovation, all revolving around better serving our customers. So, when we saw this digital license plate, it was natural for us to jump in! We are looking forward to providing Galpin customers another industry first.”

CDK adds software provider dealerAffinity to partner program

ATLANTA - 

dealerAffinity is the latest company to join the expanding CDK Global Partner Program this year, the company announced Tuesday.

Via its solution suite that includes online trade appraisals, live web chat with text messaging and on-site auctions, dealerAffinity can help car dealers convert web visitors into leads.

“In an increasingly digital world, automotive retailers need refreshing ways of engaging and converting online car buyers,” dealerAffinity co-founder Aaron Haimovitz said in a new release. “Together, CDK and dealerAffinity will provide our shared customers with the solutions they need to attract, engage and convert online car shoppers, all within the robust and proven CDK ecosystem.”

As an approved CDK Partner, the company and is now part of a marketplace made up of over 300 partner companies that offer more than 400 different applications for auto dealers.

“We're very pleased to introduce dealerAffinity as the newest member of the CDK Global Partner Program,” added Howard Gardner, vice president and general manager of CDK Data Services. “dealerAffinity is a welcome addition to our vibrant program that provides dealers with a range of partner choices and the assurance that their programs can be seamlessly integrated with our applications.”