A $104 million growth investment is driving the automotive industry forward.
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Impel, the New York-based digital engagement startup, announced on Tuesday it secured $104 million in growth investment. The fresh funding was led by Silversmith Capital Partners with additional investment from Wavecrest Growth Partners.
The startup offers an AI-powered customer engagement platform for the auto industry, allowing shoppers to have a more tactical car-buying experience online. The company says it had a hand in $2 billion worth of car sales since its inception in 2011. Impel works with around 100 partners in the automotive space and has spent its past two years growing its revenue by 100%.
The auto industry is hitting the gas on AI
Since around 2012, the car market has slowly inched further online and away from traditional dealerships. Prolific new-car companies like Tesla and Rivian operate with direct-to-consumer models, and companies like Carvana went public on the basis that it was easier to buy a car online.
The move toward clear pricing is part of a larger car-buying trend that has moved away from dealerships and negotiating with salespeople. According to a 2021 Cox Automotive study, “Consumers generally remain less likely to visit dealerships during the car buying process. The average buyer visits only two dealerships in the process, and relies more heavily on digital tools.”
But dealerships are catching up. During the COVID-19 pandemic, the process of showing inventory and buying quickly moved online.
Tapping into a trove of vehicle purchase data, Impel and companies like it are able to use artificial intelligence to target customers with personalized messaging. In 2021, vehicle giant Cox Automotive announced it created a used-car e-commerce platform that would use AI to suggest accurate price estimates to potential buyers.
Vroom, another online car-buying marketplace, acquired CarStory in 2022 for its predictive market data analysis that can determine a car’s value. Meanwhile, Ravin uses AI to virtually inspect cars for damage and price them instantly.
Illustration: Dom Guzman