Thursday, June 9, 2011

RepairPal’s Musical Chairs: Where Have You Gone, David Sturtz? - David Carlisle

RepairPal’s David Sturtz has vanished from the leadership circle. When I first heard this, the tune and lyrics from Mrs. Robinson crept into my head.

"Where have you gone, Joe DiMaggio?
Our nation turns its lonely eyes to you.
What's that you say, Mrs. Robinson?
Joltin' Joe has left and gone away."
Hey, hey, hey.

David knows that I have always been suspicious of where RepairPal was headed. Based on some email exchanges and conversations I had with others, I was pretty sure that David was a stand-up sort of guy. He really wanted RepairPal to become the “trusted consumer and industry resource for auto repair and diagnostic information”. Beyond this, I suspect he really wanted to add “fair and” before “trusted”.

I could not imagine him pulling this off. If RepairPal was ever going deliver zillions of dollars to its investors, it had to follow the money. And, the money was not associated with giving dealers a fair shake. Here’s a simple hypothetical example. Jiffy Lube has 1966 stores in the United States. It does not take a rocket scientist to understand their model, the keystone of which is an oil change every 3,000 miles with aggressive up-selling of stuff that customers don’t really need. A few weeks back we showed a simple example of how you will hand over $201.75 to Jiffy Lube for something that should only cost $39.95 at a Ford Dealer. All those RepairPal geniuses should be able to figure this out. Now, if they wanted to be “fair”, they’d go after Jiffy Lube like a mongoose on a cobra. But, that would not be following the money. If they did this, no Jiffy Lube franchisee in their right mind would pay RepairPal for a featured listing – and that would cut off a pretty big hypothetical source of revenue. Furthermore, it would scare off many of the independents that RepairPal depends on for revenue growth. So, there would be a pretty big negative cost associated with being fair. What’s the offset? Hmmm. Getting a large bunch of car dealers to buy featured listings, because of a stand on why Jiffy Lube costs more? No. To follow the money you’d not go after Jiffy Lube.

The new guy, who replaced David Sturtz, is “Dave” Whorton. “Dave”, yeah, sounds kind of friendly-like. Hmm, lets see what he’s all about:
  • He comes from Tugboat Ventures where they work with tenacious entrepreneurs who want to make a difference in the world … so, just where did you go David Sturtz?
  • There lots more on Dave – basically he’s a vulture capitalist.
Looking at the board of directors (David Sturtz is no longer sitting on the Board), I don’t see anybody with a “compelling vision for the future with a deep passion for his/her business”. Unless that business is making a pile of money, driving Ferraris, and breaking bread with other VCs.

Bottom Line: “Trust” is an elusive concept. You only know it’s not there when it fails. Many times, that’s too late. In the absence of undeniable failure, you need to use your judgment to assess trust. We do that as parents. If you have a gorgeous 14 year old who hangs out with kids with facial tattoos who smoke from bongs, well, you might get a funny feeling about “trust”. Hey, you just might be wrong about those tattooed bongers – they might turn out to be the next Bill/Melinda Gates. But, probably not. So, do I “trust” RepairPal to be a fair and trusted consumer and industry resource for auto repair and diagnostic information”? Absolutely not. But, that’s just my opinion.

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