Virag Consulting was engaged by Open Dealer Exchange to develop a business around their newly acquired provider network technology. The business plan included an analysis of competitors in the space, likely customers, pricing and marketing approach, timetables, organizational design, job descriptions, and pro-forma income statements with projections.
Open Dealer Exchange is a joint venture of two leading dealer software vendors. With my ODE client, I presented the business plan to the JV board, obtaining their approval and funding. I was subsequently retained to execute the business plan. I hired and trained the staff, set up operational and accounting procedures, solicited network participants and API consumers, and worked with ODE lawyers to develop assorted contracts and a patent application.
A novel and important feature of my business plan was cross-side network effects. Provider Exchange Network is a marketplace, with F&I product providers on one side and dealer systems on the other. In addition to the provider network, this required a generalized interface to the dealer systems. I worked with ODE developers on this interface, and took the lead in signing dealer systems to use it.
Earlier F&I networks, like Dealertrack’s lender network, had been one-to-many networks serving a single dealer system. In fact, I had a hand in developing the original PEN technology to serve a single menu system, MenuVantage. Adding an open API to such a network proved to be a popular innovation, and today this topology prevails throughout the industry.