Selling a car is a pain. You can take the easy route and use services like Carvana, but you could end up with thousands of dollars less than your car is worth. Or, you could wait longer if you go to a dealer, but the dealer’s offer can vary wildly depending on what you do. they are searching, regardless of the extra time and effort on your part.

A Los Angeles-based startup called Bidbus has spent the last few years trying to combine the best of those options, so sellers don’t have to get off the couch to receive dealer-level offers. The company has created a digital marketplace where multiple dealers can bid on a car, a process that results in an average bid $2,000 to $3,000 higher than what Carvana is offering, according to Bidbus’ founders.

Now looking to scale beyond its initial markets of California and Texas, the startup has raised a $15 million Series A funding round led by early-stage mobility fund Ibex Investors. The round also saw participation from Mucker Capital, FJ Labs, Motley Fool Ventures, Data Point Capital, Walter Ventures and Yossi Levi of Car Dealership Guy.

Bidbus co-founder and CEO Duke Yan told TechCrunch in an exclusive interview that he came up with the idea after spending years buying and selling cars on his own. When he tried to help his mother get rid of her car, the dealers’ offers were insultingly low, so he put them in a group chat. To their surprise, buyers began to raise the price.

“Used car affordability is not a financing issue. It’s a market efficiency issue. Consumers lack information about actual prices for trade-ins, dealers struggle to source quality inventory, and much of the best deal is still stuck in people’s driveways,” Yan told TechCrunch.

It’s a smart combination. Dealers already buy cars at auctions to fill inventory, so the startup isn’t pitching a foreign idea. Yan said Bidbus helps dealers by offering them the highest-valued used cars, which tend to come from private sellers. The startup takes advantage of the difference between what online sellers are willing to pay and the distributor’s typically highest payment — a difference that can extend to thousands of dollars.

But getting more money for sellers, even after Bidbus took a cut, wasn’t enough for Yan. He also wants to make the experience fun and has taken inspiration from stock trading apps like Robinhood and social media apps like TikTok.

Once a car is accepted onto the platform, dealers only have a few hours to bid. Bidbus displays live bids with corresponding bids displayed in large font. The expectation, Yan said, is that Bidbus users will share screenshots or videos of this activity to raise awareness of the app and attract new potential sellers.

“Our vision is to make the sale of a car as transparent and competitive as stock trading, where the price is determined by market competition and not by a single buyer,” Yan said.

Growing Bidbus has not been easy, Yan said. The company was launched early on, and while it gained some traction early on, it admitted that it had to ban one of the largest distributors from the platform.

“At that time, he was the only one buying so many cars, so he felt like he could get away with haggling or making low bets,” Yan said. “At first it hurt me, but now our platform is better than ever. We have five to eight more distributors like him, who buy a lot and maintain the standard.” [experience] “What we want our clients to go through.”

Jeff Peters, the Ibex partner who led the funding round, said he refrained from investing in Bidbus’ initial round primarily because the company was only operating in Los Angeles at the time. But once Bidbus began expanding into new markets, attracting new customers and signing up dealer groups like Lithia Motors and Penske Automotive, Peters wanted to join.

“It looks like this is scalable and it’s a universal problem and a universal opportunity, at least across the United States. I think it’s also going to be durable, because some of the most durable business models are marketplaces,” he told TechCrunch.

“At the end of the day, they are providing value to consumers by giving them $2,000 to $3,000 more for their vehicle, as well as allowing dealers to increase their inventory and access new inventory they have never had access to before.”

So far, Bidbus has helped people sell around 10,000 cars on its platform, and Peters said he sees many advantages. Carvana showed that selling a car online can be simple and fast, Peters said. Now that vehicle owners are used to that idea, “I think people will look for the best deal, however they can find it,” he added.