The enthusiasm about dealership ownership from Vijayan’s executive team today stands in contrast to the mixed reactions the Tekion CEO got when he first floated the idea back in late 2019. Investing money into a store acquisition wasn’t an easy sell at a time when the company was relying on a smaller tranche of financing and fewer employees.
Tekion has raised $451 million in venture capital to date, with its latest round in 2021. The company has scaled operations to 3,000 employees.
Rumteen recounted his early skepticism.
“We’re a technology company,” he said. “Why do we want to get into automotive retail?”
Sankararaman responded similarly, saying he was “a bit surprised and shocked.” But he listened to Vijayan and then he came around.
“Owning these dealerships would give us an immense advantage,” Sankararaman said. “Having access to the dealer operations would allow us to build the product. Better [still], we could validate the product before taking it to our real customers.”
After a couple of days, Rumteen came around, too, he said.
One of Vijayan’s most important visits to Tekion’s Buick-GMC dealership occurred immediately after the acquisition closed. More than three years later, he remembers the energy he felt that day about trying something new.
“I was nervous and excited,” he said.
Dealership employees, many who already knew Tekion’s personnel because of the store’s participation in an earlier pilot program, welcomed the unusual arrangement, Vijayan said.
As he sees it, his grand experiment worked.
“We have a significant, solid, reliable product, and all the core features that we wanted to develop are delivered,” Vijayan said. With more than 1,000 dealerships signed up for Tekion’s DMS platform, “we’ve got enough validation,” he added.
