E-commerce giant eBay has was announced plans to acquire Caramela startup that helps car sellers and buyers complete the final steps of the transaction — including verification, financing, paperwork, title transfer, insurance and more.
As eBay has grown over the years, it has had to evolve to stay competitive – last year, for example, the company scrapped seller fees in the UK to deal with a new wave of startups in the market. In the automotive sector, in particular, eBay has acquired several startups to stay ahead of the curve, including advertising and marketing technology company Cargigi, as well as UK classifieds site Motors.co.uk.
Last month, eBay’s old nemesis Amazon also entered online car sales with the launch of Amazon Autos in partnership with Hyundai. While this is all about finding and buying new vehicles directly from the dealership, it’s understood that Amazon could expand its scope to cover used vehicles in the future.
Ultimately, eBay wants to ensure it remains a key channel for safe, fast used car sales at a time when consumers have more choices than ever.
Founded out of Los Angeles in 2021, Caramel officially launched last year with about $19 million in funding from backers including FJ Labs, Hearst Ventures, Zeev Ventures and Primera Capital.
Candy can be used to complete sales initiated through independent agencies or markets, including eBay. At the check out point, Caramel is provided as an option to verify people’s identity, manage the transfer of securities and registrations and transfer money. Buyers can also choose financing options and arrange delivery of the vehicle.
While eBay already offers some leading and services to facilitate online car sales, such as e.g escrow to preserve fundsbringing Caramel in-house will allow it to speed up the process by taking care of a huge chunk of stressful post-sales management.
But more than that, Chris Prillgeneral manager of eBay Motors, says the acquisition is about “building trust” in the vehicle buying process, helping buyers and sellers avoid scams.
Neither company disclosed an acquisition price, but eBay said it expects the deal to close in the first quarter of 2025.
