By Ben Fox Rubin
TrueCar Inc. filed for an initial public offering Friday, with
the car-shopping website looking to raise up to $125 million.
The filing comes just after the company on Thursday said John
Krafcik, the former chief executive of Hyundai Motor America,
joined TrueCar's board.
TrueCar, founded in 2005 and based in Santa Monica, Calif.,
provides users with pricing information on new and used cars, and
connects them to its network of certified dealers. TrueCar users
have purchased more than 1.1 million cars from those dealers,
including nearly 400,000 last year.
The company has had a renaissance since going through a crisis
in 2012. The service was growing quickly, selling the notion to
buyers that they could get the lowest price possible for cars. It
tracks purchases of vehicles and shows consumers what the highest
and lowest price people paid for a car in their area. Dealers began
to complain that consumers were demanding prices that were so low
they couldn't make money and the company lost thousands of
customers, and even drew attention from some state regulators
saying the service violated consumer protection laws. The company
was losing money and needed a cash infusion from investors to
survive.
The Web firm changed its marketing and provided more tools to
dealers to balance the transaction and the company has thrived
since.
While the company is currently focused primarily on new car
transactions, it said in a regulatory filing Friday that it intends
to introduce new services based around car buying and car
ownership. For instance, the company said it is developing
TrueTrade to provide users with an estimated daily market value for
their existing cars and a guaranteed trade-in price.
For 2013, the company posted a loss of $25.1 million, compared
with a year-earlier loss of $74.5 million. Revenue jumped 68% to
$134 million.
TrueCar said it intends to apply to list its stock on the Nasdaq
Global Select Market under the symbol "TRUE."
Goldman Sachs Group Inc. and J.P. Morgan Chase & Co. will
act as the joint book-running managers for the offering.
Write to Ben Fox Rubin at ben.rubin@wsj.com
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