Online auto marketplace CarGurus today raised $150 million in an IPO, and has seen shares pop by more than 70% (bringing its market cap to nearly $3 billion). Axios spoke with chief financial officer Jason Trevisan about the IPO, its unusual funding history and how it's become so big without using traditional advertising until very recently. The quick read:

  • The IPO is to improve public branding, enable acquisitions and to provide liquidity to early employees.
  • The company has relied on "aggressive algorithmic traffic acquisition" to achieve its 23 million monthly unique visitors.
  • Trevisan isn't worried the company left money on the table, saying volatility may be high because CarGurus offered relatively few shares.

AXIOS: Why go public now?

TREVISAN: "We've gone public for three reasons. Number one is as a branding event for both consumers and dealers. We've become the largest online auto marketplace, yet have been under the radar, so this is an opportunity to grow our brand. Second, this gives us currency for acquisitions. We are a platform model, and believe we're well positioned to acquire tech and content businesses. Third is liquidity for early investors and employees, who have worked their butts off for years."

How has an "under the radar" company managed to attract 23 million unique visitors per month?

"Aggressive algorithmic traffic acquisition. We have a team of 10 developers and mathematicians who've built homegrown technology that allows us to acquire consumers when they're at the point of cash search. For example, we bid on about half a billion keywords per day -- and have tested over a billion keywords over the last couple of months. We also have great word of mouth, which is the second-most cited reason for people coming to the site. This year we began investing in television for the first time."

CarGurus raised around $130 million from T. Rowe Price and Fidelity beginning in 2015 but before that was bootstrapped for nearly a decade. Why the change in funding strategy?

"From 2006 to 2010 the company had a different business model, which was more content-oriented. In 2011 we shifted more into actual car shopping, and that model began to scale very quickly. In 2015 we raised capital from T. Rowe to both solidify the balance sheet and provide some liquidity to friends and family who had invested. Then we added Fidelity for more liquidity, and also because we knew at some point we wanted to go public, so it was important to have great partners with us."

The stock is up more than 70% after just a couple hours of trading. Thoughts on leaving so much money on the table?

"We were most focused on getting a great investor base..."

You could have maybe gotten a better one at $2 per share.

"Well, I can't imagine getting a better group of investors. But, overall, share price volatility in the first six months is really more about supply and demand working itself out than about long-term value. Also we did a very low float, which we knew would create more volatility early on, but it was right for the company."

Go deeper

Updated 28 mins ago - Politics & Policy

Coronavirus dashboard

Illustration: Sarah Grillo/Axios

  1. Global: Total confirmed cases as of 9:30 p.m. ET: 33,867,247 — Total deaths: 1,012,341 — Total recoveries: 23,537,059Map.
  2. U.S.: Total confirmed cases as of 8 p.m. ET: 7,229,319 — Total deaths: 206,887 — Total recoveries: 2,840,688 — Total tests: 103,939,667Map.
  3. Education: School-aged children now make up 10% of all U.S COVID-19 cases.
  4. Health: The coronavirus' alarming impact on the body.
  5. Business: Real-time data show economy's rebound slowing but still going.
  6. Sports: Steelers-Titans NFL game delayed after coronavirus outbreak.
Ina Fried, author of Login
1 hour ago - Technology

Facebook removes Trump ads tying refugees to COVID-19

Photo Illustration: Aïda Amer/Axios. Photo: Saul Loeb/AFP via Getty Images

Facebook said Wednesday that it was removing a series of ads from President Trump's campaign that linked American acceptance of refugees with increased coronavirus risk, a connection Facebook says is without merit.

Why it matters: The ads were pulled after they received thousands of impressions and are a sign that the Trump campaign continues to test the limits of social media rules on false information.

Over 73 million people watched the first debate on TV

Data: Nielsen; Chart: Andrew Witherspoon/Axios

More than 73.1 million people watched the first presidential debate on television on Tuesday night, according to Nielsen ratings.

Why it matters: While that's a sizable audience for any American TV program, it's down more than 13% from the record number of TV viewers who tuned in for the first debate of the 2016 election. The chaotic nature of the debate and the overall uncertainty around this year's election may have pushed some viewers away.