George Arison

We don't have as good of a set of options for subprime, for example, as we do for prime.

And so if you're a subprime customer, we might not be able to get you a financing product.

And that's part of that missing piece between 65% and 80%.

Not all of it, but some of it.

But, you know, when I started SHIP, no one believed that you would get a loan online.

And obviously, you know, we've kind of shown that very much do.

And people actually like that experience a lot because they're in control and they're not waiting in a dealership for four hours trying to get financing done.

No, the debt is to buy cars, right, because we own the cars, and you'll underwrite those with a debt because there's an existing product that you can use to do that at a very low interest rate.

But when we started Shift, we did want to do capital loans.

It was kind of a vision.

My co-founder, Toby Russell, who's my co-CEO as well, he had actually been at Capital One before we started Shift, and part of the thinking was, like, learn a lot about financial services to get a financial services company going.

But what you learn over time is that until you're doing about $100 million of securitization...

every quarter, it's too expensive to do your own loans.

So we need to get to about a billion dollars in sales

of which then 40% we'd be doing on our own.

So like $400 million of loans on our own to be able to do them in a profitable way.

So eventually, you know, out in 2024, 25, we will do capital loans, but we just need to grow to be large enough before we can do that.

Otherwise, the costs are just way too prohibitive.

We've raised about $225 million in equity and $75 million in debt, so about $200 million.

We did the first close in September 2018 and then second close in December of 2018.