Peter Grøftehauge, CEO Autorola: “In 2018, we will sell half a million cars online”
Exactly twenty years ago, two Danish brothers had a revolutionary idea: to sell used cars over the internet. Today, Autorola is a worldwide expert in online auctions. CEO Peter Grøftehauge looks back – and ahead.
Back in 1996, the internet was still in its infancy. But the Grøftehauges smelled an opportunity. “Our father was a used-car dealer, and we got together to think about the future. To sell cars 'electronically' – the word 'online' didn't even exist back then - we determined that the three conditions would be: a clear description, trust, and the ability to buy via the computer”, says Peter Grøftehauge.
He described the process, his brother programmed the software. Autorola was a pioneer in online remarketing. But business was slow in the beginning: “A lot of potential customers didn't have access to the internet. And a lot of interested dealers did not even have a computer. We heard from all around that our plan was just not possible”.
But the brothers persisted – even if it meant taking a step back, technologically: they devised a scheme to use fax messages that allowed customers to check a bid and make an offer. In 1997, they also worked out an electronic system by which dealers could remain informed of the latest used-car prices. This system, Bilpriser (Danish for 'car prices') would form the basis for the current, internationally acclaimed Indicata programme.
After a few very difficult years, the brothers hired their first employee in 2000. “We couldn't afford one earlier”, laughs Grøftehauge. Things improved in the new millennium, in parallel to the rapid development of the internet itself. Autorola focused on gathering a strong IT team. “Because essentially, we are a software company”.
Business started accelerating from 2005 onwards. In that year, Autorola ventured outside its Danish home market for the first time: “By 2008, we had a presence in about 15 countries”. The financial crisis that year made itself felt also at Autorola; but after the initial shock, the company's aim was to offer more solutions, and provide the used-car market with an even broader range of services. In combination with its pioneering experience, that strategy paid off for Autorola.
“Right now, we have around 380 employees worldwide, a local presence in 20 countries and business activities in 35 countries”, says Grøftehauge. “We recently set up shop in Turkey, Australia, Brazil, Mexico and the U.S., and we have plans to expand into China”. Most of Autorola's expansions have been greenfields. “Because we believe in financing our own growth, and because matching cultures after an acquisition can be a challenge. But that didn't prevent our takeover of Global Remarketing in the UK, nor does it preclude future acquisitions”.
Autorola didn't throw a big party for its 20th birthday, for two reasons: “We are a global company now, and it would be impossible to invite everyone, nor would it be fair to celebrate just with our Danish staff. Plus, we are more interested in what the future will bring”, says the CEO.
And that is? “We will continue our expansion outside Europe. As alien as the online experience was 20 years ago, so accepted is it today. I predict that within five years, all cars will be sold online. Software systems will become more intelligent, and clever use of Big Data will eliminate a lot of the inefficiency that is still present in used-car sales”.
Big companies like Amazon have felt which way the wind blows, and are also getting into the online automotive business. “No problem, these are big, big markets, there is lots of space”. And Autorola will claim as much of that space as it can: “This year, we will have about 250,000 vehicles on our platform, within two years, we will hit half a million”.