Piyush Gupta, founder of the now-defunct LiquidPrice.com, thought he had the right model for selling cars online. But he ran out of money too quickly to take advantage of it.
LiquidPrice.com, of Santa Clara, Calif., shut down June 15, a victim of the soured venture capital market.
The Web site had a network of 700 dealers in nine metropolitan markets - Atlanta, Boston, Chicago, Los Angeles, New York, Philadelphia, San Francisco, Connecticut and New Jersey.
Gupta thought his site had an advantage because it gave consumers the chance to negotiate vehicle sales anonymously with dealers. Site visitors described the vehicles they wished to purchase. The anonymous requests were posted on an online message board, and dealers within 50 miles of the customers could bid for the deals.
He said LiquidPrice charged dealers $250 for closed transactions, instead of a monthly subscription or a fee per referral typical of other online auto-buying services. Gupta said the site was closing 350 to 400 car sales a month, but he had no way of monitoring whether dealers were reporting all of the closed sales.
If he could do it again, Gupta would charge dealers a monthly subscription to participate in the bidding. But the monthly subscription rate is far from his biggest problem. Gupta said he would need at least $20 million in venture capital to revive the site, and he hasn't found any takers.
In other dot-com news:
The board of directors for Parts.com Inc., a Sanford, Fla., online parts exchange and software provider, has approved a one-for-10 reverse stock split. Every 10 shares of Parts.com stock converted into one share at the close of business Wednesday, June 27, reducing the number of shares issued and outstanding from about 30,145,197 to 3,014,519, according to the company. Parts.com Inc. closed at 11 cents a share June 27; the day after the split, it was trading at $1.40 a share.
Staff Reporter Donna Harris can be reached at [email protected] or 540-668-7295.