21 Please pay attention to the disclaimer below. Keep in mind that this video does not substitute your research on the ICO but is merely the start of it. You can learn more here: https://ico.trustedcars.com/
Trusted Cars Flex allows you to rent a car, in the inventory of a car dealership, directly from the car dealer. You can learn more about Simon, Trusted Cars and their business in the interview. Tune in to learn more.
Disclaimers: Please consult your professional financial, investment, and tax advisers before making any investment in initial coin offerings (“ICOs”). Startuprad.io does not provide investment or financial advice and does not endorse or recommend investment in any ICOs. The content of this interview is provided for informational purposes only and should be supplemented with independent research and factual verification. Startuprad.io receives compensation for promoting this ICO. Startuprad.io does not offer or sell any securities, solicit investors for securities offerings, engage in any negotiations regarding potential investments, or participate in the sale or purchase of any securities or otherwise effect transactions in securities. Any offer, sale or purchase in ICOs is in the sole discretion of and is conducted directly between, issuers and the prospective investors. All information provided regarding potential ICO investment opportunities is prepared solely by the issuer, and such issuer is solely responsible for the accuracy of all such statements. Startuprad.io has not independently verified any such information.
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Welcome to startuprad.io your podcast and YouTube blog covering the German startup scene with news, interviews, and live events.
[00:00:20] Joe: Hello and welcome everybody. This is Joe from startuprad.io your startup podcast and YouTube blog from Germany. Today I am in lovely Frankfurt, in a co-working space here and I do have Simon with me who is an entrepreneur from lovely Frankfurt. Hey how are you doing?
[00:00:36] Simon: Hey and thanks, I’m good, great thanks, how are you?
[00:00:39] I’m doing great thank you. I’m very happy that we finally could make it because, we’ve like postponed our interview, we postponed our interview and I was this morning seeing a dentist, so I also had to reschedule that. But we finally made it and I’m very happy about that. Today we are talking cars, well more or less.
[00:01:00] Simon: Yes, exactly.
[00:01:01] Joe: Can you just tell us a little bit about what you are doing? Like personally before you started a start-up, and then we get into cars.
[00:01:09] Joe: Okay sure. And first of all, sorry that I had to postpone this interview a few times, but we’ve been traveling a lot especially in Asia lately during our roadshow. That’s why we had to reschedule a few times, but finally we made it. To my background I have a master’s degree in finance and innovation management from the University of Mannheim here in Germany and ESC Paris in France. Before founding Trusted Cars, I worked as a management consultant for a few years. And then I guess it was kind of destiny I founded Trusted Cars. Destiny because it’s actually a fun fact. I used to live in the street in Mannheim where the car was founded.
[00:02:01] Joe: For everybody who’s not from Germany the car was invented by Kyle Benz and he was living close to Mannheim, which is I would say a medium-sized city south of Frankfurt. And basic he then founded the company Mercedes-Benz, and do you know why this car is called Mercedes? It’s a Spanish female named, at the time a car was so fancy so advanced he could only find an investor from Argentina and he had a beautiful spent daughter with a Spanish name. And he said him you get the money but only if you call the car Mercedes.
[00:02:43] Simon: Yes exactly, nice story exactly. And yeah and the fun fact is he used to live like his garage was back in the days like hundred it’s now hundred thirty years ago. His garage was across my house where I used to live in Mannheim and this was the street where the first car was ever driven by his wife actually.
[00:03:08] Joe: Yeah, he was not brave enough, and his wife did actually the first car trip for him. And by the way that also makes sure Garret companies also maybe German invention.
[00:03:20] Simon: Yes exactly
[00:03:22] Okay, you got from Mannheim, you studied, you’ve been a management consultant and how did you approach the idea of Trusted Cars? I mean at the beginning you had most likely a lot of ideas, you had in mind you could do stuff like this. And how did you actually get to this idea? And how is your company working right now?
[00:03:41] Yes we founded Trusted Cars three years ago and it was a personal experience which I back then had which was the reason why I found Trusted Cars. It was, I was actually looking for a car and not for the first time but for the third time, third time it was supposed to be my third car, but I was working a lot. And then like then I asked myself how do people nowadays buy a car? And it starts with a research of few marketplaces, large ones in Germany as well like everywhere where you go and do your research.
But then you have to like make phone calls, appointments, go there look at the car as a layman. How does the money transfer work? Do you have to pay in advance? How does the transport of the car work? How do you like to register the car etc? So only actually only the research part is online and everything else is offline. And with a lot of hassle, and it’s like you with a lot of risks and a lot of effort combined. And then I ask myself OK nowadays I do a lot online, like almost everything online. And, but when it comes to buying a car everything is offline and very risky.
And how can we how can we change this? And then we found Trusted Cars with the idea of bringing online shopping as a major part of modern society onto the automotive industry. And I guess we are pretty successful. We’ve been called several times the Amazon for cars by the media here in Germany. Received a few awards for this concept as well and now we have the new concept the new product Trusted Cars Flex which is which is also like a new game changer now.
[00:05:26] Joe: I just have one main question, are you also going to Amazon the German car dealership industry?
[00:05:32] Simon: How do you mean like sir?
[00:05:34] Joe: Like Amazon and industry, like wiping out the existing competitors and take over the markets?
[00:05:39] Simon: That’s the difference actually because we work with dealerships. So, we don’t go to let’s say them like we don’t want to put the dealerships out of work, but we work with dealerships, with selected ones. So, we have to mention this, because we don’t take every dealership to work with. They have to have the same quality and customer experience and service as what we want to offer our customers. So, we have selected dealerships we work with and they like working with us that’s why we are growing really fast.
And this is also the reason how we’ve now why we are introducing the new product. This is, we have actually designed the new solution with dealerships together. Because we saw a problem on both sides from, dealerships and customers. And that’s how we are going to change this and design a new solution that will help everyone in the market.
[00:06:36] Joe: So, you’re basically enabling brick-and-mortar dealerships to do e-commerce with the cars selling primarily, used cars, secondhand cars online right?
[00:06:49] Simon: Exactly! That was pure, like that was our traditional product Trusted Cars, and now with Trusted Cars flex, what we saw we have been working with dealerships for the last three years. And then we saw, we talked to thousands of consumers in the last three years. And the point was we saw that customers more and more are into like not buying the car but using a car. So, they want to have a simple, convenient, flexible, and affordable solution, how they can have a car without ownership responsibilities.
But all the current concepts, mobility concepts are either too expensive, not available in your city or not convenient. Let’s take for example leasing, if you have like a leasing car a year ago, you have a contract between three and five years. If you want to use car sharing, it’s really expensive. If you want to take a car sharing a car for let’s say 24 hours for a day, you pay like more than 100 euros and it’s not available in every city. Only in major cities and so on like the current mobility concepts don’t like are not that convenient for customers.
And then we saw the other problem with dealerships as I said we have a lot of dealership partners we work with and then the structure of the market dictates that they purchase their inventory in packages. Which means they get some cars which sell really fast in a few weeks, but some cars remain unsold for six months or even longer.
[00:08:17] Joe: It’s like the American like we will get approximately 50% of our viewers from the United States. It’s for Americans, it’s like your cable subscriptions. You get the few you want, and you also have the ones nobody else wants right. It`s the same principle.
[00:08:32] Simon: I mean it’s the same with the dealerships in the US as well. They don’t buy their cars piece by piece. Though I mean the large dealerships not the one with 30 cars on its lot. But the large dealerships they buy their cars, their inventory in packages. So, to get the nice car which they sell in 3-4 weeks for a nice win, with a nice you know margin, they need to get the other car which doesn’t maybe for six months. Because it has maybe like the I will say the wrong colour or it’s just too expensive.
And these cars cost a lot of money. There are a lot of statistics about this, the average car costs fifteen dollars per day per car.
[00:09:13] Joe: That means its basically debt capital
[00:09:16] Simon: Exactly
[00:09:17] Joe: And it’s standing around maybe in even in your backyard and actually it costs you money and it depreciates because it’s just standing around. Even though nobody’s, maybe only people are looking at it, nobody is touching it nothing but it’s still losing value because it gets older.
[00:09:34] Simon: Exactly and the this, this problem we saw it because we’ve been receiving a lot of data from the dealerships in the last few years. We analyzed this, and we said hey there you have this as you said, debt capital and we have the customers who are looking for a convenient and affordable solution. Why don’t we combine these two problems and have like a real solution in the market and which everyone can profit from?
And this is Trusted Cars Flex actually, our new product.
[00:10:04] Joe: Sorry but what came first into my mind and are you then only able to like drive that was cars nobody wants, like the ugly green ones with the purple dots on it and they look very strange or no what is he what do people have to expect from Trusted Car Flex.
[00:10:25] Simon: No, I mean it’s the cars are almost the same cars the dealership has. So, we talked to the dealerships, we asked them which car or which cars you would like make available for the customers, and almost all of them said I don’t mind I would try it with every car. Because they are not ugly cars, maybe the example with the color was the wrong one. Because usually you have let’s say these leasing cars companies have, and what an employee usually does is he puts every special equipment and everything he even you know can think of
[00:11:04] Joe: they list ones top down
[00:11:06] Simon: They have this list, and so this car gets really expensive. And if you want to sell a car like this let’s say BMW Pfeiffer or Audi A6 and it costs more than 70,000 euros, no one’s going to buy the car because it’s really expensive to resell this car.
[00:11:25] Joe: And what’s the advantage for the car dealership working with you?
[00:11:29] Simon: Yes, yes so, he has returning customers, he is a mobility service provider, not only salesmen from with us. And additionally, to the income further income, he has access to a new generation of customers, who so far didn’t like to go to a dealership or didn’t want to buy a car and keep the car for the next five six seven years. But for this he has, as I said this access which is very important to this new customer, new generation of customers.
[00:12:02] Joe: And that’s basically the same idea going like, all the big automotive companies they are offering a service. You basically pay a few hundred a few thousand years a month and you can pick any car. And for you it’s almost the same but you’re not locked to one company, one group of card companies or something like this, you can have the whole menu.
[00:12:27] Simon: Exactly, exactly. And there are some car manufacturers are trying subscription models right now, especially in the US and a few cities. But they are if you look at the prices they’re usually very very expensive and they’re locked. They still lock you into contracts for about 12 months what, we don’t do. With us you are not locked into any contracts, you can change cars as often as you like. You make you just make a low weekly payment for as long as you keep the car, and it’s an all-inclusive offer. You can take every brand, every make, every model. And you’re not locked into it and a big difference is also that we have the infrastructure with the dealerships.
So, we have the cars, we have the infrastructure for us, we can scale this really fast and very important it’s much cheaper than other model concepts out there.
[00:13:24] Joe: That sounds like a real cash flow intensive business, meaning you get cash flow out of it, the car dealerships get out of it. And you’ve been talking about like to expand expanding rapidly and you’re going to do this raising capital with an ICO, right?
[00:13:41] Simon: Exactly we are now going to start I mean we are now in the ICO phase of our year. We are in the ICO right now, in the pre-sale currently. Our main sale is going to start on the 17th of September and exactly. So, there are a few aspects why we are doing in ICO. You mentioned, of course, raising money that’s one aspect. We need more funds to further develop our product but, almost as important as the fund part is the marketing part. And we’ve had we have drawn a lot of attention with our ICO so far. We have closed some major really good partnerships which we will also announce very soon on our website.
And of course, we want to use our first mover advantage to expand really fast to other countries as well and this is also a big a reason why we did we are doing ICO because we are now talking to customers and also partnerships companies all over the world. If it’s, I mean we have so far closed major partnerships in the US and South Korea etc. So, I guess this wouldn’t be that easy without drawing so much attention with an ICO.
[00:14:56] Joe: And when we’ve been talking before basically we were calling this in the middle of August so the prices of Bitcoin, Aetherium and many newly minted ICO are currently going down. Are you feeling anything like a drag, on your investor base from that?
[00:15:16] Simon: Not really, because I have to mention that we are accepting fiat currencies as well, like euros and US dollar. And a lot of our investors are investing in fiat money, so they don’t mind that the Bitcoin or Aetherium rate is currently decreasing. But of course, there’s like in the market, in general, like, I mean like you can in Germany we say Sama loaf, of course, like you have this summer,
[00:15:48] Joe: The time when every everybody’s on summer vacation, the schools cut for summer break and stuff like this. That’s also one of the reasons we don’t to start up news in July or August because we can basically wrap it up in September.
[00:16:01] Simon: Yes, and this is why our public sale will start on the 17th of September not now, but we are now in the pre-sale and talking to large investors and they don’t mind. Because we have we have if we compare us to other ICO, the difference is that we have an established business. As I said we found Trusted Cars three years ago, we have a lot of renown large corporations, partnerships. We have established a team and everyone who’s talking to us who’s reading our white paper knows that our token the Flex token is not combined or doesn’t, is that much influenced by the Bitcoin or Aetherium.
Because we are not doing like a lot of startups do crypto-based, they have a crypto-based business model. What we have is of course also crypto-based because of our flex token, but we have we have another business case which that is not,
[00:17:02] Joe: You mean their cash flow is determined by the crypto price?
[00:17:06] Simon: Exactly!
[00:17:06] Joe: Yes okay, and the usual disclaimer for everybody I see us on ICO, everybody you should truly consider your personal situation before you go an investor. Ask an adviser and I’ve seen in many telegram groups I see oh groups that people are talking about, yeah there’s YouTube influencer and he does only 20 times 30 times his initial investment. It`s not an expectation so you should approach. Because there’s usual disclaimer down here and there’s also the website and your LinkedIn profile and you can go down here and start your research.
Because that’s the thing you should do right now if you’re interested and not instantly invest. Sorry, here you go.
[00:17:50] Simon: Ya, no this is a really important point, I mean that’s why we tell everyone do your due diligence, look at the profile of the founder, look if do they have an existing business like do they have like a business which is incorporated in a country you trust. Like for example we have a game behind in Germany
[00:18:10] Joe: It’s a German version of an Ltd.
[00:18:12] Simon: It’s like limited exactly and this was like three years ago. So, we didn’t just, you know wrote a white paper and started doing an ICO, but we have a business which is as I said an established business and with we have been working on this solution for more than a year now and it’s not just and you should be very careful and do your due diligence and talk to the founders. Everyone like myself if you contact me I will take my time to talk to them, to every investor no matter how large or small there.
[00:18:45] Joe: And the contact details and everything you will find down here. For you I just have a few more questions left. And first thing I had in mind when you said you can basically own any car, you can drive any car, I was wondering are you working with a Lamborghini dealership right now?
[00:19:05] Simon: Actually, we have one right now and it’s
[00:19:10] Joe: I didn’t know that up front.
[00:19:11] Simon: Yeah actually we have one yes. And that’s the funny part like we don’t even have to contact them. With the ICO everyone is kind of getting in touch with us because they are, it’s the best marketing we could we can have. Everyone is like we have had so many interviews with newspapers and with conferences etc. So really large dealerships also like in other countries are coming up to us talking to us and asking us how they can cooperate with us, and partner with us. And most recently we closed partnership with a Lamborghini dealership yes.
[00:19:49] Joe: That is pretty cool. I once again I didn’t know that up front, he just surprised me with that. And you have the largest car and the small car I would assume something like a
[00:20:00] Simon: Smart
[00:20:01] Joe: The Smart yeah yes, the mini would come to mind.
[00:20:05] Simon: Yes, I mean the idea is you go to like you go to our app you see the cars, you select the car, you sign for it in the app, you can pick up the car at the dealership. We are now working on it and it will work as well as soon as we launch this. The car will also get delivered to you if you want to, and you can start driving around.
[00:20:24] Joe: And right now, in which countries is this or will it work from the start? I assume, you-you tend to expand but right now there will be some countries where you start right?
[00:20:36] Simon: Yes, we will start in Germany because we have the largest dealership base here. And also of course because we are from Germany and, but we will expand really fast. We also have like in our white paper we have our roadmap, you can have a look at. But there was also like a small change now because we have a very good cooperation with some major dealerships and other partners in South Korea. Why we will probably start in South Korea and France.
[00:21:07 Inaudible] Joe: Say whole to South Korea.
[00:21:08] Simon: Yes exactly. And so, we have a few countries we want to expand to into 2019 plus South Korea as well. Now in 2019 and the latest in 2020 we want to expand to the US as well.
[00:21:25] Joe: So, every car dealer out there who’s seen this go down here, reach out to the guys and we would be more than happy if it will be successful.
[00:21:33] Simon: Thanks
[00:21:35] Joe: Great thank you very much
[00:21:36] Simon: Thank you
[00:21:36] Joe: Thank you for being here and best of luck
[00:21:40] Simon: Thanks. Thank you.
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