TrueCar wants cash to grow its operations.

Online automotive shopping site has announced plans to go public – a significant turnaround for a service that some thought might not survive a series of legal challenges that forced the company to make some major changes to its business model over the last two years.

TrueCar revealed it had filed the necessary paperwork – known as a Form S-1 – with the Securities and Exchange Commission  just a day after it announced that former Hyundai Motor America CEO John Krafcik had joined the company’s board of directors.

Though the firm’s management could not comment about the IPO due to federal guidelines, the planned stock offering is expected to raise as much as $125 million which would be used to further expand the firm’s aggressive growth plans.  TrueCar previously  raised significant funds through private equity offerings, including a $30 million investment by Vulcan Capital, the investment arm of Microsoft co-founder Paul Allen.

Former Hyundai Motor America CEO John Krafcik will join TrueCar's board.

The web service has made some significant investments in recent years, among other things purchasing ALG, the former Automotive Leasing Guide, for $83 million.  That purchase was explained as a way to further enhance TrueCar’s core strategy of providing highly accurate pricing information to potential car buyers.

(March car sales thaw out after frigid winter Click Here for the story.)

The firm currently counts more than 7,500 U.S. new vehicle retailers as part of its network. Visitors to the TrueCar site are provided data on vehicle costs, as well as a range representing what previous shoppers had paid for that model.

The website derives its revenues from both advertising and dealer fees.

For the year that ended December 31, TrueCar reported a $25 million loss. But that was down from a $74.5 million deficit the prior year. And 2013 revenues rose 67%, to $134 million.

Founded by Scott Painter – a web veteran who has been involved in a number of earlier online automotive shopping ventures – TrueCar has a number of key competitors, listing such web powerhouses as, AutoTrader.Com and, as well as the automotive buying venture run by warehouse giant Costco.

TrueCar’s model is somewhat different in that it lines up dealer partners who subscribe to the service rather than paying a fee for each potential shopper that’s referred over online.

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But TrueCar ran into some serious challenges in 2012 when dealers and regulators around the country questioned whether its model ran afoul of strict state franchising regulations.  Notably, states like Texas and Virginia bar so-called “bird-dogging,” or auto brokering, where a third party steps in to help a customer get a better price.

At one point, the web service was forced to halt operations in several states. But it eventually rejigged its business strategy, in some cases making state-by-state changes.

The brouhaha initially led thousands of dealers to walk away from TrueCar but it has largely recovered since then – and it is betting that its financial improvement will signal the company’s potential to investors.

Goldman Sachs and J.P. Morgan Securities LLC are serving as lead underwriters, according to the prospectus filed with the SEC.

There’s been plenty of action in the auto buying space.  Georgia-based AutoTrader purchased Kelley Blue Book several years ago.  In recent months, Chicago-based has been put on the market.  Meanwhile, Autohome Inc., a Chinese operator of various car sales websites, saw an 83% jump in its stock value after it debuted on the U.S. market in December.

As for the news that Krafcik will join the TrueCar board, it’s the former Hyundai CEO’s first major public appearance since his contract with the Korean carmaker lapsed last December.

“Very few people are credited with elevating an emerging brand to top-­‐tier status within the automotive industry,” said TrueCar founder Painter, in a statement. “John Krafcik is one of those remarkable leaders who has done just that over the last five years.”

(Hyundai planning to step up the pace of product intros. Click Herefor the story.)

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