Patrick Bayliss spent a quarter century as a dealer principal, buying, selling a number of dealerships. During those 25 years he also took note of what he calls a “pain point” for consumers.

“The highest level pain point for the consumer was in and around the finance process,” Bayliss told Forbes.com.

So a little over two years ago Bayliss and his partner co-founder and CPO Joshua Tatum, created Carputty, an online auto financing site where consumers can apply for lines of credit up to $250,000 to purchase a new or used vehicle, refinance an existing loan of buyout a lease.

“Carputty de-couples financing from the purchasing process. We’re non-transactional. We’ve built a piece of technology where we underwrite who you are, not necessarily what you drive,” explained Bayliss. “We don’t ask you how much you make. We allow our data to absorb who you are and you would get approved for a Carputty Flexline, $50,000, $100,000 or $250,000.”

If a Flexline is dormant for two years, it’s closed with no carrying costs or annual fee.

“We like to say it’s the last auto loan you may ever need because there’s no need to reapply,” said Bayliss.

Carputty’s approach has impressed investors. The company announced Tuesday $12.3 million in Series A funding co-led by Fontinalis Partners and TTV Capital, joined by Porsche Ventures and Grand Ventures, bringing Carputty’s total funding amount to $21.96 million. Kickstart Fund led Carputty’s seed funding round.

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“Unlike student loans or mortgages, where the consumer experience has undergone significant innovation in recent years, traditional auto-financing remains cumbersome, opaque and expensive. Carputty stands to change that, and it’s building a fundamentally new consumer solution for an automotive market that has $1.5 trillion in outstanding loans and 276 million registered cars,” said Chris Cheever, Founder and Partner at Fontinalis Partners in a statement.

This new infusion of funds will help power a company that Bayliss says is in “full-on growth mode.” Currently available in 36 states, Bayliss says he expects Carputty will begin serving auto shoppers in all 50 states, and almost double its 48-person workforce to about 80, by the second quarter of 2023.

“We’re working with potential business partners right now where the technology we’ve built can be an embedded or integrated tool with other fintech companies,” said Bayliss.

Along with Carputty’s existing B2B and B2B2C revenue streams, Bayliss says the company is focused on “growing our potential integration ability with other lenders so they can take advantage of the technology we built.”

A 2020 study by the Federal Trade Commission looked at the type of pain points consumers endured related to auto financing Bayliss discovered through his own experience, leading to Carputty’s creation.

The report documented the experiences of 38 consumers who had recently bought and financed a new vehicle through a dealership.

Among its key findings were:

  • Consumers often didn’t qualify for attractive zero percent financing listed in advertisements
  • Consumers didn’t realize they could negotiate annual percentage rates for financing
  • Some consumers complained they had to re-negotiate the price in the finance office after they had agreed to terms with the sales person.
  • Some consumers reported they were called back to the dealership to cancel the contract they signed, or have the finance terms changed because the dealership “couldn’t find a finance entity to accept the contract.
  • The whole buying and financing process just took way too long.

Bayliss believes Carputty’s model neutralizes all of those pain points with its simplicity and transparency.

Indeed, the company’s name and business model are based on the flexibility of the clay, or putty, auto designers use when they’re creating new models, revealed Bayliss.

“You can break it into pieces, you can put it back into one piece so putty is the money,” said Bayliss. “You can put four, five, six, ten cars on your line. You can have one big car on the line. We internally joke, hashtag, pay with putty.”

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