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Under the hood of CarAdvice: how the start-up lapped its competitors in automotive media

While his competitors in automotive media ‘clung desperately to print’, Alborz Fallah was able to accelerate his start-up into the digital age. That was ten years ago. In September, Alborz sold a majority stake in CarAdvice to Nine Entertainment Company for $35 million. “It’s worth that and much more,” the 32-year-old Brisbanite told Dynamic Business.  

The serial entrepreneur and self-confessed Top Gear tragic (“I watched far too much Jeremy Clarkson growing up”) described the deal with Nine as an unmissable growth opportunity for his company.

“Joining with a big media organisation means CarAdvice is in a position to level-up and accelerate audience growth,” he explained.

“We now have an opportunity to tap into Nine’s extensive and highly-engaged audience across multiple digital channels, including online, free-to-air TV and streaming services such as Stan.

“The sale also eliminated the risks of being a public-listed company. We were well down the path of an IPO on the ASX when the deal was struck with Nine. As a technology and media business, we pride ourselves on investment in our staff and ability to take calculated risks on multiple projects at once – as a listed business that potential would be more limited.”

“I wanted a job I loved, so I made one for myself”

Alborz, now the second largest shareholder after Nine, started CarAdvice in 2006 and initially ran the website from his parent’s home in Brisbane. Despite having no formal or informal experience in the automotive industry, Alborz had degrees in IT and cognitive science and was already a seasoned businessman with a whopping 16 internet start-ups under his belt.

Moreover, he was driven to pursue his one, true passion as a career: “A love of cars is ingrained in my DNA so I decided to take a leap of faith. Also, I wanted to have a job that I loved, so having tried and failed to find one, I decided to make one up for myself.”

CarAdvice proved too big for Alborz’ family home, requiring him to open primary offices in Sydney and Melbourne plus a smaller office in Perth. With over a million unique visits per month, Alborz said CarAdvice is now the largest editorial website in Australia for the automotive market.

“We provide extensive coverage of the automotive industry from an editorial perspective including news as well as comprehensive reviews and comparisons on every single new car on sale in the Australian market,” he said.

“We are also the leaders, locally, in automotive video production as well as user engagement both on site and on social media. In addition to being free, we pride ourselves on content that is reliable, timely and objective. The aim is simple: we want to connect new car buyers with the right vehicle. To maintain our reputation for being the most up-to-date and reliable source of new car information in Australia, we run all our new car reviews within 24 hours of our journalists completing a test drive.”

“Our competitors complacency was our advantage”

When asked what has fuelled the success of CarAdvice, Alborz was blunt: “It would be easy to say a bit of luck – and no doubt this played some role; however, our biggest advantage in reality was our competitors complacency, their inability to evolve and general lack of comprehension of the digital age. So, whilst we invested heavily in bringing the best digital experience for automotive media, the likes of News Corp, Fairfax and ACP (now Bauer Magazines) clung to print and hence gave us a first-mover advantage that we’ve never really given back. The recent sale to Nine is, I believe, proof that the age of print publications is well and truly over.”

Aside from citing the company’s responsiveness to digital disruption, Alborz also attributed the company’s success to a strong investment in people and the enthusiasm staff bring to their work.

“From our CEO to our interns – every single one of our staff is the best at what they do and we attracted them by paying well above industry standard,” he said.

“We also gave 15% of our business in options to our long-term staff, who all enjoyed substantial financial gains when Nine purchased a majority stake in the company.

“Having said that, I didn’t start CarAdvice for financial gain and that’s not why people work for us. We’re a collective of car lovers and we enjoy sharing our opinions with others. I’ve learnt from the example set by Steve Jobs: when he bought Pixar animation studios, he fired anyone who couldn’t draw. Likewise, everyone at CarAdvice – we have 37 full-time staff – must love cars. It’s the most important prerequisite to employment with us and also a vital component of why we are the best at what we do.”

“I’m just as committed now as I was ten years ago”

The remaining stake in CarAdvice, not held by Nine, is being sold in 2018-19. Although Alborz is obliged to sell his remaining shares as part of the deal, he said he’s “just as committed to CarAdvice now as he was on day one”.

He continued, “Yes, it does feel different but CarAdvice is still my baby and I’ll be continuing on as content manager and brand ambassador. I want the company to succeed to the highest degree possible. There continues to be substantial potential in the Australian market, and our aim is to grow CarAdvice in all metrics for the foreseeable future.”

Outside of CarAdvice, Alborz is keen to launch, invest in and mentor start-ups: “I think years of start-up experience – from raising funds and hiring staff to selling CarAdvice – highly qualifies me to give advice in the startup scene and engage with boards of digital businesses. Who know, perhaps my next business will be StartUpAdvice.com.au – which, coincidentally, is a domain I own.’’

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James Harkness

James Harkness

James Harnkess previous editor at Dynamic Business

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