Our First Letter to the Industry

From Rowan Mockler, co-founder and CEO of Ekho.

This is the first of what will be a yearly letter to the people who run dealerships, and to the manufacturers, lenders, and states that work alongside them.

I am writing it because if you sign with Ekho, you are buying more than software. You are betting that we know where we are going, and that we will still be going there in five years. A sales deck answers that question badly. A letter you can keep, and check us against later, answers it better.

So this letter does four things. It says what we believe. It says plainly which parts of Ekho work today and which do not exist yet. It suggests three things worth doing this year, whether or not you ever buy from us. And it commits me to writing again in twelve months, starting with an account of what we got right and what we got wrong.

Start with your own stack

Go through the software you run, one tool at a time, and ask what kind of dealership each one was built for.

Most of the answers describe the same store. The dealer was the only record of the vehicle. The buyer walked in on a Saturday. After-hours coverage was a staffing question, and a title was a stack of paper. Each tool was a fair answer to a real problem. The problems have moved since then, and most of the tools have not.

You see the gap in small ways. A lead arrives on Saturday night and waits until Monday, by which time the buyer has booked a test drive somewhere else. You paid for the ad, the chat tool, the CRM, and the after-hours service, and the buyer still spoke to no one. An out-of-state buyer gives up because nobody can say when the title will arrive. The F&I menu sits in a separate window that the buyer never opens.

None of that is the fault of one bad vendor. It is what happens when every problem gets its own product and the dealer becomes the person who holds the pieces together. We added up what that costs in The $50B Dealer Tax: What Your Stack Really Costs, and explained why the pieces are coming back together in The Unbundling Is Over. The Rebundling Has Begun.

Five beliefs

These are the principles we use to decide what to build and what to leave alone. They are written down so that you can tell when we drift from them.

1. The stack is coming back together

For twenty years the industry answered each new problem with a new vendor: lead routing, chat, after-hours response, e-signature, titling, tax, the F&I menu. The next ten years run the other way. Buyers will not sit through the hand-offs between those tools, and the software to run them as one system now exists. We are building that one system. If in five years we are one more box on your stack, we got this wrong.

2. We should get paid when you do

Most of the tools in a dealership are paid whether the month is good or bad, and the risk of a slow quarter sits with the store. We think the companies that build a dealer’s software should carry more of that risk. Most of what the Ekho Transaction Engine earns comes from deals that close, so when your month is slow, ours is too. That is not yet true of everything we sell, and I would rather say so here than have you find it in a contract. We made the longer case for this kind of relationship in Dealers Have a Partner Problem, Not a Vendor Problem.

3. The dealer runs the relationship

We build software for dealers to sell with, and we will keep it that way. The test drive, the trade appraisal, the service visit, and the second and third purchase all happen at a store, and the store is where the buyer’s trust lives. Our job is to make that relationship cheaper to run and harder to lose, so that you can reach more buyers, in more states, with fewer hand-offs on the way to a signed deal.

4. Say what is live, and label what is not

Dealers have been sold a lot of roadmaps. The usual pattern is a slide that describes a product as finished years before it is. When we say something is live, dealers are running deals on it today. When something is still being built, we say so. This letter says more about the future than anything else we publish, so I have marked each part.

5. Build the category in the open

We call what we are building the DealershipOS: one system that runs the buyer-facing side of a dealership, from the first message to the registered vehicle. Ekho DealershipOS is our version of it. We will not be the only company that builds one, and we do not need to be. We will define the term, publish what we learn, and expect serious competitors. You are better off with more than one good option for a change this large.

What the DealershipOS is, and what is live today

I want the term to be precise enough that you can use it, and hold us to it. We think the DealershipOS needs four parts.

The conversation layer. Live today. Every inbound buyer, at any hour, answered with live inventory and financing pre-qualification. The Ekho AI Sales Agent does this on website chat and SMS, and it picks up the leads that listing sites forward to your store. The Saturday-night lead gets an answer on Saturday night.

The transaction layer. Live today. Everything from the credit application to the registered vehicle, in all 50 states. The Ekho Transaction Engine runs financing across lenders, F&I products inside the checkout, the signed documents, titling, registration, and sales tax as one flow on your own website. It does not yet cover every lender, program, and unusual deal, and we close those gaps one at a time.

The storefront. Being built. A dealer website that does more than list inventory: the buyer can ask it questions, see a real price, and buy. It is not generally available yet. Dealers who want to be early can join the website waitlist.

The customer record. Not built. One place that holds a buyer’s full history with the store: conversations, purchases, financing, F&I, and service. Ekho’s CRM already holds the leads, conversations, and deals that run through Ekho. The rest of that history, service above all, is spread across several systems, including the DMS, which remains very good at the accounting work it was designed for. We made that case in The DMS Is Not Dead. It’s Just Doing the Wrong Job. We believe the full record is needed. We have not committed to a product for it yet.

So two parts are live, one is being built, and one is an opinion. The longer definition is in Vendor Stacks Are Dead. Long Live the DealershipOS.

You do not have to wait for all four. If you run the AI Sales Agent at the front of the store and put one out-of-state deal a month through the Transaction Engine, you are already running the two parts that touch the most money: the first conversation and the closed deal.

What I would do this year

I do not think most dealers should rip out their systems in the next ninety days. Moving off a DMS takes years, the connections into accounting and service are real, and a rushed change costs more than it saves. Here is what I would do instead.

Pull every contract renewal date. Make one list: each vendor, what it costs, when it renews, and how much notice it needs. Renewals in the next twelve months are the cheapest decisions you will make this year, because saying no to one carries no exit fee. Multi-year contracts are harder to change, but their end dates set the calendar for any larger move. Most stores can build this list in an afternoon, and it is useful whatever you decide next.

Try the two live parts on a small scale. Put an AI sales agent on your current website and watch what happens to the leads that arrive after you close. Send one out-of-state deal a month through a transaction engine and count how long the title takes and how many separate vendors touch the deal. Both tests are small and reversible, and both give you real numbers inside a quarter.

If a new brand asks for space on your floor, take the call. More vehicle brands are launching without a dealer network of their own. Many of them want to reach buyers through existing stores without asking those stores to floor-plan an untested product: the buyer orders on the brand’s site, and the deal runs through you. The same agent and the same checkout that run your current business can run a new line like that. If you add one or two of these lines, you take on little risk and learn early which brands are worth a bigger bet.

None of these needs a long commitment, and you can do two of them without us.

What we ask of everyone else

This letter is addressed to the whole industry, so a few requests.

To manufacturers: the dealer is the right operator of the buyer relationship. Give your dealers more ways to sell, including to buyers outside their own market, and let them test new lines without floor-plan risk. The brands that build for their network and for these new arrangements at the same time will end the decade with the strongest distribution.

To lenders: we will send you clean, complete applications through direct integrations, with the context a credit decision needs. More of the deals that move online will go to the lenders who accept applications that way, and we would like that to include you.

To the states: titling and registration are fast where a state offers modern electronic access and slow where it does not. We would welcome the conversation with any motor vehicle agency that wants to make that work easier for its dealers and its residents.

To other builders: build serious products, and build them in public. Dealers have been short of good software for a long time, and more good competition will help them more than any one company standing at the gate.

Next year’s letter

I will write again in twelve months. Letter II will begin with this one: what we said, what we shipped, what is late, and what we were wrong about. If the news is bad, it goes first.

Our team spent much of this year on dealer floors, from Las Vegas to Austin to the Coachella Valley. What we heard most was about the gap between a buyer who is ready to pay and a store that is not yet ready to take the money. Most of this letter is about closing that gap.

I believe the dealers who make this change on purpose, on a calendar they control, will be in a much stronger position by 2030 than the ones who wait for it, and that the dealer will still run the relationship with the buyer when it is done. Ekho will be one of the companies that builds what replaces the stack, though not the only one.

Start with the contract list. Whatever you decide after that, you will decide it with the dates in front of you.

Rowan Mockler
Co-founder and CEO, Ekho