Vroom, a US-based second-hand automotive marketplace backed by car dealership chain AutoNation, has confidentially filed for an initial public offering, people familiar with the matter told the Wall Street Journal on Sunday.
The company hopes to stage the offering next month, though no financial terms have emerged. Vroom’s competitor Carvana went public three years ago after pricing shares at $15 and raising $225m, with its stock currently trading at more than $100.
Founded in 2013, Vroom operates a data-driven, end-to-end online marketplace to sell, purchase, insure and finance reconditioned cars. It provides real-time appraisals and calculates market-based pricing, picking up vehicles for free and paying out within minutes.
The company also owns a network of used car dealerships in the state of Texas called Texas Direct Auto, having acquired the business in 2015.
Vroom has secured $721m in equity financing to date. Durable Capital Partners led a $254m series H round in December 2019 that reportedly valued the company at $1.5bn.
The series H round featured L Catterton, a private equity affiliate of luxury consumer goods conglomerate LVMH, funds and accounts advised by T. Rowe Price Associates and a range of unnamed investors.
AutoNation led a $146m series G round in 2018, with commitments from L Catterton, General Catalyst, Fraser McCombs Capital, accounts advised by T. Rowe Price and assorted private investors.
Vroom’s shareholders also include New Horizons, Pico Venture Partners, Altimeter Capital, Foxhaven Asset Management and Allen & Company.
Goldman Sachs has been appointed as lead underwriter for the proposed offering, the Wall Street Journal said, also identifying Allen & Company, Wells Fargo, Bank of America and Stifel Financial as underwriters.
