Cliff Sosin

There's also a lot of technology to it, recruiting drivers, there's a lot. But that's the next piece of the system. With that, come to an IRC. And at that IRC, it'll get reconditioned. And reconditioning a car in an IRC is a challenging thing. Which dents do you repair? How do you repair it? And you can think about a reconditioning center

There's also a lot of technology to it, recruiting drivers, there's a lot. But that's the next piece of the system. With that, come to an IRC. And at that IRC, it'll get reconditioned. And reconditioning a car in an IRC is a challenging thing. Which dents do you repair? How do you repair it? And you can think about a reconditioning center

has a bunch of different stations that do a bunch of different work that's relatively homogeneous. So changing tires, changing oil, inspecting, paintless dent repair, painting, whatever the thing may be. A car starts out with a mix of work that has to be done to it. That has to be ascertained in an inspection. And then the car is going to be routed

has a bunch of different stations that do a bunch of different work that's relatively homogeneous. So changing tires, changing oil, inspecting, paintless dent repair, painting, whatever the thing may be. A car starts out with a mix of work that has to be done to it. That has to be ascertained in an inspection. And then the car is going to be routed

through the IRC to different stations, and then come out and be imaged and put on the website. Some time later, it sells. They take the car, nine-car hauler, to the hub. Now, you'll see this is beautifully balanced. The cars are coming back from the hub. They're also going out to the hub, right? So the car will go from the IRC it's at to the IRC closest to the customer along basically the rails.

through the IRC to different stations, and then come out and be imaged and put on the website. Some time later, it sells. They take the car, nine-car hauler, to the hub. Now, you'll see this is beautifully balanced. The cars are coming back from the hub. They're also going out to the hub, right? So the car will go from the IRC it's at to the IRC closest to the customer along basically the rails.

And then it will go from the IRC to the hub. And then from the hub, it'll be delivered on the single car hauler or picked up by the consumer. That's the physical system. There's also finance. If you go on their site and you enter your information, instead of searching by price, you can search every car by payment. So you can adjust the number of the months, your down payment.

And then it will go from the IRC to the hub. And then from the hub, it'll be delivered on the single car hauler or picked up by the consumer. That's the physical system. There's also finance. If you go on their site and you enter your information, instead of searching by price, you can search every car by payment. So you can adjust the number of the months, your down payment.

And you can see each payment for each car to the penny based on your individual credit score. And this isn't an estimate. This is exactly what it is. In order to do this, Carvana has a fully vertically integrated financing stack. So they're essentially underwriting you for every loan combination for every car in real time.

And you can see each payment for each car to the penny based on your individual credit score. And this isn't an estimate. This is exactly what it is. In order to do this, Carvana has a fully vertically integrated financing stack. So they're essentially underwriting you for every loan combination for every car in real time.

And then they're taking that and they're making it available to you through this cool widget. To this day, as far as I'm aware, no one's replicated this capability. In order to do it, you need to be vertically integrated into prime lending, subprime lending. It just turns out that no one else is, and it's also very hard to get into these businesses as well. There's title and registration.

And then they're taking that and they're making it available to you through this cool widget. To this day, as far as I'm aware, no one's replicated this capability. In order to do it, you need to be vertically integrated into prime lending, subprime lending. It just turns out that no one else is, and it's also very hard to get into these businesses as well. There's title and registration.

Obviously, you've got customer service. The thing about this business, you have to remember that, like, this is all great, but things go wrong. Then you have to deal with, like, all the many, many corner cases that can come up. If you want to entertain yourself, like, go read the one-star reviews at Carvan.

Obviously, you've got customer service. The thing about this business, you have to remember that, like, this is all great, but things go wrong. Then you have to deal with, like, all the many, many corner cases that can come up. If you want to entertain yourself, like, go read the one-star reviews at Carvan.

It's like, well, I was moving, and I ordered the car when I lived in Florida, but I needed it delivered to North Carolina. And, you know, then, like, there was a hurricane, and as a consequence, it was late. But then, like, there was a problem with the title, and you're like, oh, my God. Yeah. That's kind of how the system works.

It's like, well, I was moving, and I ordered the car when I lived in Florida, but I needed it delivered to North Carolina. And, you know, then, like, there was a hurricane, and as a consequence, it was late. But then, like, there was a problem with the title, and you're like, oh, my God. Yeah. That's kind of how the system works.

Now, in that whole system, like, let's identify some economies of, like, scale. Inventory. Turns out selection matters. Matters a lot. And there's, if you think about all the makes, models, trims, years of cars, as well as mileage, like, the selection space is massive. And Carvana's coverage, even at its size, is still relatively small.

Now, in that whole system, like, let's identify some economies of, like, scale. Inventory. Turns out selection matters. Matters a lot. And there's, if you think about all the makes, models, trims, years of cars, as well as mileage, like, the selection space is massive. And Carvana's coverage, even at its size, is still relatively small.

And so, as a consequence, conversions go up as selection goes up. And so, selection is, like, big economy scale.

And so, as a consequence, conversions go up as selection goes up. And so, selection is, like, big economy scale.