Recently, the CBT Automotive Network was on-location at NADA 2020 in sunny Las Vegas where host Jim Fitzpatrick spoke with Jason McClenahan, President and CEO of EBlock.
VIDEO TRANSCRIPT:
Jim Fitzpatrick: So for the dealers that are watching right now, as I just introduced you as the president and CEO of EBlock, for the few dealers out there that are not as familiar with your company yet as we are here at the show, tell us what you’re all about and the solutions that you provide to dealers.
Jason McClenahan: Yeah, no problems. So we are Canada’s fastest-growing online auction platform Canadian market. We were founded in 2015 by a gentleman by the name of Ryan O’Connor. Ryan’s background is buying vehicles online at auctions for 30 years. So he really designed the platform from a buyer’s eyes which naturally rewards the seller with better values on their vehicles because it’s built from a buyer’s perspective. And our co-founder, Dmitry Vodiansky, has built automotive verticals in the past so even from a tech standpoint, we have automotive experience combined with brick and mortar auction experience, which is what makes our platform so unique.
Jim Fitzpatrick: Sure. Fantastic. So success in Canada, EBlock has entered the US market, what does the current strategy look like?
Jason McClenahan: Yeah, so we just had a major pivot in our strategy and we’re very excited to go through that. In the Canadian market, for those of you that aren’t aware, we are the auction. There wasn’t a business model to make with independent auctions, there just wasn’t enough there. So Canada was really our playground to test the product, get customer feedback, build a team, and it’s gone very, very well. We’re now bringing that recipe with everything we’ve learned to help give the independent auctions the means to compete in the digital dealer space and not only survive but thrive in the future.
Jim Fitzpatrick: And talk to us a little bit about independent auctions and then what the strategy deck there is as well.
Jason McClenahan: Yeah, so really right now Manheim has their digital tools, you’ve got Car Global that has TradeRev. But the independent auctions don’t have a means to facilitate any transactions outside their gate. So really our model is going to be, bring our experience, which is brick and mortar auction experience combined with digital auction experience, and help bring them into the future with the best industry class, best technology to go compete with the other competitors in this space.
Jim Fitzpatrick: Wow, fantastic. So what’s the timeline to roll out more auctions?
Jason McClenahan: Yeah. So we just rolled out our first auction at Pacific Northwest with Bob McConkey and his team and they’ve been amazing to work with. And the feedback that’s come so far has been extremely validating and even talking to dealers here about our new approach and new strategy in the United States, it’s very exciting time. Right now we’re slated for March 1st to roll out eight more auctions and we’ve got a roadmap to roll out another 100 in the next 12 months.
Jim Fitzpatrick: A hundred in the next 12 months?
Jason McClenahan: Yeah. So we have a-
Jim Fitzpatrick: That’s very impressive.
Jason McClenahan: We have a very aggressive roadmap but we got that integration and a technology set up with Auction Edge in six days. Our technology team is very agile and I’m spoiled to be able to lead this thing with the technology I have behind me.
Jim Fitzpatrick: That’s great. What separates you from some of the others in the space?
Jason McClenahan: You know, really, I think it’s… We’ve built a platform for years of experience, buying cars at auction, myself and my 20 years experience in the auction business, 17 of those in the brick and mortar business. And like I said before, we built it through a buyer’s eyes. So auctions have done a great job for decades creating events, urgency and selling cars in 60 seconds. So we’re the only online auction platform that can actually simulate the immediacy and urgency of a live, physical auction without an auctioneer.
Jason McClenahan: So we have run lists that buyers can get organized and show up to an event at one set time and then compete for the car in 60 seconds. And that really does drive up values of the car. And in the United States, about 60% of the cars are sold in 60 seconds. So we’re able to really capture a good chunk of the market and really deliver results for our sellers.
Jim Fitzpatrick: How to dealers use the tool?
Jason McClenahan: So dealers can use the tools in various ways. They can self-inspect cars, post them up in their showroom, and actually help appraise a vehicle for a consumer while they’re trying to desk a new car deal. 20% of our sales in the Canadian market are live appraisals. The other 80% of our cars we are selling right now are grounded trades, so they’re wholesale pieces that are aged inventory that the dealers want to re-market.
Jason McClenahan: And in the Canadian market, our strategy is a bit different where we would go to the dealer’s lot, do the condition report, upload it to the platform, and then provide it to the buyers. So buyers can acquire inventory and sell inventory through our platform, through our inspections or their own inspections.
Jim Fitzpatrick: So if I’m a used car manager and I’m appraising a car, in real-time I can get numbers back on that car?
Jason McClenahan: Yeah absolutely. You can push the vehicle up to the marketplace with a condition report and within five minutes there’ll be a guaranteed auction price on that car. And then the bidding will take over there from light bidders.
Jim Fitzpatrick: That’s fantastic. And I understand your background is actually in the auction business.
Jason McClenahan: Yeah, it was a really hard decision to leave brick and mortar auction. It was harder because one of my passions is auctioneering so it hurt my heart to go into this space but I saw the change coming and I wanted to help shift that change for the physical auctions. And I feel like we’re in a sweet spot to be able to do that.
Jim Fitzpatrick: So if I wanted to sell this card right here for $5,000, how would you sell that?
Jason McClenahan: That’s really putting me on the spot but I could probably auction it off if you like.
Jim Fitzpatrick: Let’s do it right now.
Jason McClenahan: All right. It’s been a couple of years, so give this a go.
Jim Fitzpatrick: I’ll give you-
Jason McClenahan: How much do you want for it?
Jim Fitzpatrick: I want five grand for it.
Jason McClenahan: All right, well so we’re going to start the bidding up at 4,000. Four, going to be 41. 41 two, going to be two, two, two, two, two. Going to be 42 going to be 43. We’re out now. Okay, you’re out four. Going to be 44, we’re going to be 45 five, five, five. I’m going to be 45. 600. 700. 800 and 900. Got to be nine, nine, nine, nine, nine. Going to be nine. 5,000. Even money going once, twice, sold $5,000.
Jim Fitzpatrick: I love it. That’s awesome. Nice job. That was two years ago.
Jason McClenahan: It’s been a while. I’m a little rusty. I probably couldn’t do it-
Jim Fitzpatrick: That was rusty?
Jason McClenahan: I couldn’t do a hundred cars anymore.
Jim Fitzpatrick: I’m happy selling the car for five grand.
Jason McClenahan: I might do five cars.
Jim Fitzpatrick: There you go. Well, that was really awesome. So Jason McClanahan, I want to thank you so much for joining us here on CBT News. It’s been a pleasure and certainly want to bring you back. And for dealers that are out there that want to learn more about this, it’s as easy as going to EBlock.com?
Jason McClenahan: It is as easy as going to Eblock.com or if you deal with any Auction Edge, physical auctions, reach out to your Auction Edge provider-
Jim Fitzpatrick: Ah, good point.
Jason McClenahan: And we’ll be able to help-
Jim Fitzpatrick: Kind of a grassroots deal.
Jason McClenahan: Yeah, we’ll help walk the dealers through the roadmap because we’ve had a lot of conversations with dealers. They want to know when, when can we use this tool in my marketplace, and we’ll be able to give them some more insight to what we’re doing.
Jim Fitzpatrick: Fantastic. All right. Dealers you’ve heard it here first so you got any questions, reach out to Jason, he’ll be happy to help you. But it’s all about doing this at a much smoother, easy process, right?
Jason McClenahan: Yeah. It’s as simple as you can make, high adoption rate, and because we sell cars in 60 seconds at set auction times, we can get more eyes on cars and sell a higher conversion rate of cars.
Jim Fitzpatrick: That’s great. Thanks again.
Jason McClenahan: Thanks for having me.
Jim Fitzpatrick: Yeah. Thank you.
