Some VCs are betting that consumers are ready to adopt car maintenance information and solutions on the Web – especially as the bad economy forces them to hold on to their cars.
Today, Allegis Capital, along with Catamount Ventures, said they are putting $5.3 million into DriverSide, a car site for consumers and car maintenance professionals started by StepUp co-founder Jad Dunning. The new round is on top of an August 2008 round by Catamount that raised $3.1 million. Another car maintenance site, RepairPal, was launched in 2007.
DriverSide pre-populates auto information pages, or “garages,” when consumers take advantage of the free registration. The site, which is supported via advertising and leads, provides articles, community forums and reviews. Last year, it acquired fairBenjamin, which provides leads for mechanic leads.
Along with the funding announcement, DriverSide also announced today that it was partnering with Integrated Services Inc., which provides software for oil-changers. Other partnerships have been formed with Precision Tuneups and various extended warranty partners.
On an anecdotal basis, the bad economy appears to be driving more searches for parts and repair as consumers hold on to their cars longer, says Dunning. He adds that shift is starting to occur in the auto space away from direct marketing towards the Web, “a much more relevant marketing tool” than the normal carshop marketing tool –a postcard.
The site’s independent positioning also plays a factor in its positioning. Marketdrive, an earlier site from the 1990s,failed in part because it was seen as being too closely tied to manufacturers, says Dunning.
Regarding DriverSide’s $5.3 million, so much for The Sack Doctrine, which essentially says: “take last year’s magic number of $3 million and divide by 3.”