Mr. Infantino had previously started three companies, all in the enterprise software market, but wanted to venture into something auto-related. After his experience, he knew what the project should be.
His first step was to go through a “customer discovery phase,” which allowed Mr. Infantino to see if there was a market for this type of service application. He said his goal was to “build a marketplace where I could connect both consumers and shops together and be part of that whole transaction.”
“And to do that, I built a prototype and brought it to shops,” Mr. Infantino said. He sat down with dealers and went over their pain points and how this could possibly alleviate some of them.
“It appeared like I was getting the green light on both sides of the marketplace,” Mr. Infantino said, noting that both dealers and consumers seemed interested in the idea.
“Whenever you build a marketplace, you have that chicken and egg problem where you need both sides of the marketplace to work.”
He said just like eBay, Openbay needs both buyers and sellers to work. He started with a private beta version in summer 2012, with about 20-30 providers and then started to reach out to friends and family to start using the service. The company then launched its public beta program in January 2013.
Openbay received funding from Google Ventures, a16z seed, Boston Seed Capital, Stage 1 Ventures and several individual investors.
After the company received funding, it was able to build a mobile app to “mirror the functionality that was found on the web,” Mr. Infantino said.
“It's been a fun process for us,” he added.
The initial target of the public beta was the 15-20 miles outside the Boston area and Openbay signed up about 400 shops. The company launched the business nationwide at the end of October and within weeks expanded to upward of 40 states.
“They are coming in droves every single day,” Mr. Infantino said.
There is relatively no risk for a dealer to sign up on the website, he added, because there is no annual, monthly or subscription fee. Every shop that signs on gets their own free website in the marketplace so customers can see what kind of services they offer and what vehicles the business supports.
“Most providers, their pain points are around marketing dollars: how do they spend their marketing dollars? Are they getting a good return on investment? And with us, they pay us on performance,” Mr. Infantino explained.
He said there is no guesswork involved like in some other marketing ventures, such as taking out an ad or putting up a billboard. The dealer can see what he or she is getting.
“They can sign on and become a member and look at all the traffic and make a decision on…what service requests they want to respond to,” Mr. Infantino said.
How this all works is that a customer would sign into Openbay and type in the services they need for their vehicle. Different auto service providers can respond to the service request with quotes.
“We tell people how far they are from that location, what their ratings and reviews are, what their certifications are, what the amenities are and then, obviously, pricing information as well,” Mr. Infantino said.
He added that usually the lowest price does not win, but other factors, such as convenience and location play into customers' decisions.
Once the customer selects the desired provider, Openbay processes the customer's credit card information and gives them a code to provide for the dealer. Openbay charges a 10-percent service fee and then an additional 3-percent credit card processing fee.
For a detailed explanation of how the transaction works, check out the Dec. 9 edition of NewsPoint.
Participating dealers have received positive feedback from their participation with Openbay.
“I've gotten a lot of clients from it,” said Barry Steinberg, owner and president of Watertown, Mass.-based retail dealership Direct Tire and Auto Service.
He said when most people buy tires or need automotive repairs, they will ask a friend or someone they know if they do not have a loyalty to a facility already.
“What this has done, is sort of taken that whole ‘ask a friend' kind of thing out of the loop and has allowed the consumer to go in there, do their own homework and put it out there for bid,” Mr. Steinberg said.
He said it allows the customers to base their decision on quotes, prices, geographical location or reviews.
“We found that a number of clients that we've gotten from it have been very new to the Boston area,” he said, “a number of students, people who have been transplanted here for business, a couple of military people….”
The method is very simple and private and making it “a seamless event for the consumer.”
Mr. Steinberg said Openbay is still in its beginning stages, and “working out what's working best, not only for the client, but for us.”
He said there are people who will type in service for oil changes, which is sort of a waste of time for the dealer, but he tries to go around that by having the prices for those pre-priced services listed on the company's page on Openbay. This also allows the customer to immediately have access to those prices, instead of having to wait for a quote.
Alexander Tallett, founder of Driveway Doctors, an auto repair shop that does mobile repairs, said his business has seen a fair amount of business as a result of the website so far.
Mr. Infantino attributed some of Driveway Doctors' success on the site because of its convenience, which is proving to be important to consumers.
“We definitely try to offer the highest level of convenience for our customers,” Mr. Tallett said.
He said that he thinks that definitely plays into it, but also thinks the company is “relatively aggressive on price.”
Mr. Tallett said one downfall of the site at this point is that the company can put out a lot of quotes and not hear back on most of them.
“There's a lot of time you put into putting quotes out,” he said, “but if you are efficient about it…the company is a very solid company, there's no risk of not getting paid or anything like that.”
The mobile app supports iOS 6 and iOS 7 and is available on the Apple App Store. The company plans to release an app for Androids, but does not have a date set at this time.
For more information, visit www.openbay.com.