HyreCar Inc.
Q3 2019 Earnings Call Transcript

Published: 10 Nov 2019

[Operator:]

Ladies and gentlemen, thank you for standing by, and welcome to the HyreCar’s Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speaker presentation, there will be a question-and-answer session. [Operator Instructions] Please be advised that today's conference is being recorded. [Operator Instructions]I'd now like to hand the conference over to your speaker today, Joe Furnari, CEO. Thank you. Please go ahead, sir.

[Joe Furnari:]

Thank you, operator. At this time, I'd like to welcome all to our Third Quarter 2019 Financial Results Conference Call. With me on this call is Scott Brogi, HyreCar's Chief Financial Officer. We're excited to update you on our progress over the past quarter and provide you with some insight into our vision for the future of Transportation as a Service and how we plan to monetize that vision today and in the future.Before we get started, I'd like to take this opportunity to remind you that during this call, we will be making forward-looking statements within the meaning of federal securities laws regarding HyreCar Inc. Forward-looking statements include, but are not limited to, statements that express the company's intentions, beliefs, expectations, strategies, predictions or any other statements relating to its future earnings, activities, events or conditions.These statements are based on current expectations, estimates and projections about the company's business based in part on assumptions made by management. These statements are subject to known and unknown risks and uncertainties that could cause actual results to differ materially from those projected or implied during this call. In particular, those described in our risk factors included in our documents that the company files with the U.S. Securities and Exchange Commission.In addition, such statements could be affected by risks and uncertainties relating to factors beyond the company's control. We should not rely on our forward-looking statements as predictions of future events. All forward-looking statements that we make on this call are based on assumptions and beliefs as of today, and we undertake no obligation to update them except as required by applicable law.Our discussions today will include non-GAAP financial measures. These non-GAAP measures should be considered in addition to and not as a substitute for, or in isolation from our GAAP results. A reconciliation of GAAP to non-GAAP results may be found in our earnings release and supplemental materials, which was furnished with our Form 10-Q filed today with the SEC and may also be found on our Investor Relations website at ir.hyrecar.com.We reported another outstanding quarter in Q3, with revenues increasing 38% to $3.7 million from $2.7 million when compared to the same period last year. Unique drivers added to the platform rose 54% to 3,716 in the third quarter of 2019, as compared to 2,416 new unique drivers added in the third quarter of 2018.In the same time period, new driver leads to the platform have grown to over 123,000 per quarter, with a new high of over 51,000 leads in September alone. This creates a tremendous opportunity for us over the next couple of quarters to match drivers with cars on our platform. As we announced a couple of weeks ago, our ability to match drivers with cars has recently began to pick up substantially.Although we had substantial year-over-year revenue increase of 38% in the quarter, longer lead times for our commercial program was primarily the reason for the slight dip in sequential revenue from the second to the third quarter, in addition to seasonality and some internal restructuring of the sales team. We expect to see a substantial uptick of cars, rentals and such revenue from that activity in Q4 and continued sequential and year-over-year revenue growth throughout 2020.Our dealer initiatives and OEM pilots are now showing the momentum that we expected and congratulations to the team for thoughtfully executing on our plan. We expect to be on-boarding an OEM dealer pilot for the exclusive dealerships of a large global car manufacturer soon. That would include several dozen dealerships initially, and has the capacity to bring a large number of cars onto a platform over the next several quarters.We used to target low double-digit cars per dealership and our expectations with the addition of these multi-rooftop large commercial dealerships and OEMs, we are now moving that number to high double-digit to low triple-digit cars per dealership for these large dealership partners and our core geos, and low to mid-double digits for dealerships overall. This should change the rate that we scale cars on the platform dramatically.At the same time, we value all of our dealership partners, large and small, because each group brings something special to this market. To give me some sense of the increase in commercial bookings, the number of cars that were rented on our platform from commercial partners increased 85% from Q2 2019 to Q3 2019. In addition, from September 2019 to October 2019, commercial bookings grew 98%.Continuing to build capacity and scaling dealer relationships were the main themes of our dealer initiatives in Q3. In our 2019 second quarter call, we noted 170 commercial accounts had listed approximately 2,300 cars on the platform. I'm happy to report that today we have increased commercial accounts by more than 50% to approximately 300 accounts, representing approximately 4,300 cars listed on the platform.4,300 cars represents the total cumulative cars listed to the platform without accounting for attrition due to vehicle sales. Attrition rates of this vehicle population are expected, because dealers move inventory in and out of the platform due to sales, maintenance, pricing and natural delisting of cars from out of market geolocations. This is also an advantage for dealers, because it helps place cars with drivers and bring new cars onto the platform.Last quarter, we mentioned marketing and car supply focus in five core geos. These top 5 key geos now have thousands of new cars listed in tranches, enabling us to match drivers in large geography notes. As an example, our top dealerships now have over 450 cars listed for approximately 45 cars per dealer group.In aggregate, we have approximately 125 commercial accounts that have listed 2,200 cars in these regions, or an average of 17.5 cars per account. Again, these 2,200 cars represent the total cumulative cars listed to the platform without accounting for attrition. Attrition rates of this vehicle population are expected, because dealers have moved inventory in and out of the platform due to sales, maintenance, price and natural delisting cars from out of market geo locations.The current pipeline is even more robust with an Additional 50 opportunities in these regions with an initial listing projection of over 1,800 vehicles. To put these numbers in context, given our current revenue take rates and demand velocity, we're well on our way to 10,000 daily active rentals, which would represent approximately $100 million revenue run rate.I cannot say exactly when we will have the 10K, 10,000 daily actives, but with more dealers adopting and Transportation as a Service mentality and pending OEM pilots becoming official, we are very optimistic that it will come sooner given the rate of change of cars being added to the platform.We're also seeing utilization improve as dealers become a large part of our vehicle inventory. Utilization will becoming a more important to KPI to track in the future, because we found that dedicated commercial supply on the platform is being rented greater than 90% of the time, whereas individual or peer-to-peer supply is under 75%.A few reasons for this utilization include

[Scott Brogi:]

Thanks, Joe. For the three and nine months ended September 30, 2019, net revenue increased 38% to $3.7 million and 65% to $11 million, respectively, when compared to the equivalent periods last year, and down modestly sequentially from $3.8 million in the prior quarter. Revenue growth in the third quarter was primarily driven by increased booking revenue that rose 4.3% during the quarter as net rental days increased to approximately 146,000 in the third quarter from approximately 140,000 in the second quarter for the reasons that Joe mentioned.Revenues were also impacted by a reduction in incentives that we benefited from in prior quarters. We continue to see the higher take rate or net revenue margin associated with the two new service tiers we rolled out in Q2. And in October, we reached an all-time high with more than 60,000 rental days, an annualized rate of over 700,000 rental days.Gross profit increased 61% to $2.3 million for the three months ended September 30, 2019, from $1.5 million for the same period in the prior year, and increased 1% sequentially from $2.3 million in the prior quarter. The two additional service tiers, the 80-20 standard tier and the 75-25 premium tier, have dramatically improved our net revenue margin.Operating efficiencies due to increasing scale continue to favorably impact our direct costs. As a result, our gross profit margin improved to 63% for the three months ended September 30, 2019, as compared to 54% for the same period in the prior year and 61% in the prior quarter, as we had a full quarter of the new revenue tiers impacted this quarter.We expect further margin improvement as we realize continued economies of scale and new affiliate marketing opportunities within the digital economy ecosystem. Operating expenses increased to $6 million for the three months ended September 30, 2019 and 87% increase as compared to $3.2 million for the same period the prior year and $3.7 million in the prior quarter.This was primarily due to increased staffing expenses, marketing and insurance payments to support business expansion. The score does include approximately $0.7 million in non-cash stock-based compensation, up from just $0.1 million in the prior year.Our net loss increased to $3.6 million, or $0.24 per share for the three months ended September 30, 2019 from $1.8 million or $0.15 per share in the same period in the prior year and from $2.1 million or $0.17 per share sequentially from the prior quarter.After adjusting for the higher non-cash stock-based compensation in this quarter, though, and adjusted net loss of $3 million, or $0.19 per share resulted versus $2.1 million or $0.17 per share in the prior quarter.Cash totaled $13.1 million at September 30, 2019, an increase of $8 million from $5.1 million at the prior quarter-end June 30, 2019, and an increase of $6.3 million from $6.8 million at December 31, 2018. This increase was primarily the result of the completion of our secondary offering in July 2019.We believe we are now well-positioned to expand growth by investing into the dealership opportunity to drive pilots with car manufacturers and mobility companies into formal strategic partnerships, while investing in top line growth and continuing to make progress towards cash flow profitability.Now, I'd like to turn the call back to Joe to wrap up.

[Joe Furnari:]

Thank you, Scott. So, in summary, we are continuing to grow rapidly, and this growth is fueled by macro tailwinds pushing individuals toward a new future and it is called Transportation as a Service. We see HyreCar perfectly positioned to enable drivers, OEMs, auto dealers and fleet operators access to the Transportation as a Service opportunity and for all to earn revenues from participating rather than disintermediating the traditional players.Feedback from our OEM and dealership initiatives has been positive. So, we're doubling down on efforts to build scaling capacity into the platform to accommodate our vehicle suppliers. Driver demand continues to be robust and providing a consistent value-add experience for our driver customers has been a key focus.To conclude, I believe HyreCar is reaching an incredible inflection point and I look forward to continued operational execution and shareholder value creation over the long-term.With that, I'll turn it over to the operator. Operator?

[Operator:]

Thank you, sir. [Operator Instructions] I show our first question comes from Mike Grondahl from Northland Securities. Please go ahead.

[Mike Grondahl:]

Yes. Thanks, guys. A couple of questions just to understand the dealer commercial accounts and whatnot, you gave us the 300 commercial accounts, and they have 4,300 cars listed on the platform, how does that compare to the 170 you had mid-August with 2,300 on the platform? Are we talking about apples-and-apples there?

[Joe Furnari:]

Yes, that is apples-to-apples, Mike. And I wanted to maintain those numbers and I want to explain those numbers. So number one, those numbers are commercial accounts and all-time listed cars. And so I was very specific in saying is that 4,300 cars from 300 commercial accounts that have been listed all-time on the platform.There is a significant amount of churn in there, because those dealerships, commercial accounts are selling cars. They're in there via taking those cars at a fleet for maintenance. And then they're either put them back on or if they've been sold, they don't come back on and they come in and replace them. So, there's a significant amount of churn that apples-to-apples that is the [Technical Difficulty] we've had a tremendous growth there in vehicles listed to the platform.

[Mike Grondahl:]

Got it. So just to be clear, since August, you've added 130 Commercial accounts and about 2,000 cars gross, kind of under a cumulative measure?

[Joe Furnari:]

Correct.

[Mike Grondahl:]

Okay. Got it. And then…

[Joe Furnari:]

And – one last point on that, Mike is that the bulk of those cars started coming on in at the end of September, early in September. What – the inventory that we thought was going to start hitting the platform in late June, early July, really started to materialize in the latter-half of that quarter. So, you're really starting to see it snap back in or a follow through all of that inventory coming along into October and that's why I'm really, really excited about Q4.

[Mike Grondahl:]

Got it, got it. And then in your additional third quarter highlights, you guys talk about number of cars rented on our platform from commercial partners increased 85% from 2Q to 3Q. Just help me understand that a little bit deeper? And then the commercial bookings grew 98% from September to October. Could you, I guess, break that down for me, what do you mean there?

[Scott Brogi:]

Yes. And so that's part of the shift in the mix conversation that we're having, which is moving the inventory away from peer-to-peer more towards commercial, and the amount of cars coming on are really kind of replacing the peer-to-peer cars. And so that's the kind of the shifting and the turnover of vehicles on the platform.So, when we say 85% growth for us sequentially from Q2 to Q3 means that those cars are commercial cars that are being booked in Q2 over Q3. And you're seeing a tremendous snap – fall – flow-through from September to October and 98% growth. And that kind of supports the statement that I said earlier about cars coming on in the latter-half of Q3 and you’re seeing the flow-through into Q4.

[Mike Grondahl:]

So, is your dealer or commercial account business now like 80% of the business and peer-to-peer is down to like 20? I mean, it seems like it's shifting way to the dealer side. Is that fair?

[Joe Furnari:]

Yes. I mean, it's trending 70-30 now, and we see that continuing to grow even more into Q4 and 2020.

[Mike Grondahl:]

Okay and I had just two more. I just want to stay on this dealer kind of track, if you will. So, your five core geos, those five cities that you focused on more and more, can you repeat, Joe, what you said there? I think you said there were 450 cars live up – just go over those numbers again, because it was pretty quick and the opportunities you have there? And then I have one follow-up.

[Joe Furnari:]

Sure. So, the top dealerships in these five geos…

[Scott Brogi:]

And that’s just the top 10, right?

[Joe Furnari:]

Yes. And that's just really our top 10 dealers. They have about 450 cars approximately in those top five geos. And so that's the equivalent about 45 cars per dealer. [Multiple Speakers] Sorry, go ahead.

[Mike Grondahl:]

The top 10 dealers in those five geos have 450 cars live, or about 45 per dealer group. That's what you were saying, okay.

[Joe Furnari:]

Yes.

[Mike Grondahl:]

And then what were you saying about 125? Was the dealer's total that have 2,200 cars cumulative?

[Joe Furnari:]

Yes, exactly. So, 125 commercial accounts have listed cumulative to 2,200 cars, approximately 2,200 cars in that region. And then when I look at a pipeline going into Q4 and into 2020, you're looking at other 50 dealer groups, with a potential to put on another 1,800 vehicles, 1,800-plus.

[Mike Grondahl:]

Okay. Hi, my last question, and then I'll jump back in the queue is, you made reference to 10,000 daily actives, and you don't have a timeline on that. And I get that, it's lumpy, but what is the daily actives today at the beginning of November, so we can at least see where you're today with daily actives and how far we might think 10,000 is away or how long?

[Joe Furnari:]

Yes. I would go back to what Scott was saying about – more about the rental days and how we're trending in rental days. If we look at what we did, there’s about [145,000] rental days in Q3, trending really well just on a run rate basis over 180,000 rental days in Q4. So, if you think about it like that. And then you can always, with those rental days, you can always back into what the average daily active is, if you take an average of GMV per day.

[Mike Grondahl:]

Got it. Okay. Hey, I'll jump back in queue. Thanks.

[Joe Furnari:]

Thanks, Mike.

[Operator:]

Thank you. Our next question comes from Mark Argento from Lake Street. Please go ahead.

[Unidentified Analyst:]

Hi, guys, this is John from Mark, appreciate you taking my question. First drilling into the dealers again a little bit. Can you describe some of the attributes of these dealerships within your core geos and overall, where you're having success and what's helping you drive that? And kind of following up there, how is the overall kind of sales conversion timeline trending now that we have the sales team really ramped up? Thank you.

[Joe Furnari:]

Yes. Great question. So, we – what we found recently is that, there are hybrid dealers out there that have really embraced mobility by building out this alternative revenue arm of a dealership. What was traditionally new and used car sales, F&I products, parts and services. Now, you have this fourth revenue stream that is, which is rental remote, subscription, et cetera. And so we've found these large dealer groups that already had the infrastructure in place that were already running vehicles for subscription through their courtesy car programs.And so coming to them, the comment was, wow, this is – HyreCar is the platform what we thought this other platform was going to be. And so they're really excited about working with us. And we're really excited about working with them, because that represents over 1,000 cars over the next two quarters.So, these larger regional hybrid dealer groups are what we've now started to really target here. In addition to the smaller independents with the – that are adding the 10 to 15 cars. That's really the shift and the focus of the outside sales team right now.

[Unidentified Analyst:]

Got it. And any commentary on kind of overall conversion times, now that the outside sales team has really ramped up of those…?

[Scott Brogi:]

In terms of these dealerships that really understand the mobility space, I – these dealerships were first contact to listing a car and renting a car for the first time in under 30 days, whereas it's been 90-plus days with a dealership that has to be or has to be sold on what Mobility as a Service or Transportation as a Service. So, lead times actually pick up as well. So, I'm really excited about the velocity that outside sales team and our internal sales team has really started to exhibit here, latter-half of Q3 and early Q4.

[Unidentified Analyst:]

Awesome. Thanks, guys.

[Joe Furnari:]

Thanks, Mark.

[Operator:]

Thank you. Our next question comes from Jack Vander Aarde from Maxim Group. Please go ahead.

[Jack Vander Aarde:]

Hi, guys. So in the past, you've indicated that the average rental fee is somewhere around $35 per day. And given the positive trends report on the key metrics, such as new commercial accounts, listed vehicles, new driver additions, I just want to ask about that $35 day kind of charge. Is there any material changes in the average rental fee that you're being – that's being charged? Especially given that dealerships, I believe, are more cost competitive?

[Scott Brogi:]

Yes. Jack, great question. It's Scott here here. Maybe I'll take that one. Yes, I think, as we see these larger dealer groups start to move in on the platform, as Joe was talking about, we are seeing those dealers being very aggressive from a pricing perspective. But I think by and large, when you look across the platform that growth is still kind of in place.We are seeing a couple of key markets, where maybe people are nudging down closer to $30 a day, then $35, it's not really a dramatic shift. And then with those protection plans that we rolled out in Q2, we still have a very strong net revenue margin coming from that. So, not huge changes, but we are seeing dealers being a bit more aggressive.

[Jack Vander Aarde:]

Okay. So, it’s helpful. Just clarify that, would you say the four of the price would be around $30, then?

[Scott Brogi:]

Yes, I think that's the general range is kind of that $30 to $35 gross daily price, where we're extracting our owner fee revenue share from.

[Jack Vander Aarde:]

Got it. And then, in the past, you've also noted that I think the overall median rental term you're seeing is around 18 days. I guess, first question, is that still the case?

[Joe Furnari:]

I think, it's ticked down a little bit. I think we're probably kind of in that 16-day range right now. That – that’s – we're still kind of exploring what that looks like. I think when you have professional fleet managers on the site, it makes it easier to rent cars in like three-day, like over the weekend there versus a whole week. And so it's a little bit easier to have a used-based type of driver come in and rent for two or three days and then come off versus the peer-to-peer side, where you rent it from an individual and it's a lot easier to take it for a week plus, if you're a driver, and if you're a vehicle owner, because you don't have to worry about the key handoff. So, as we start to reduce friction by bringing on commercial accounts, I would assume you're going to see that tick down a little bit.

[Jack Vander Aarde:]

Okay. And then – that's helpful. And then lastly, you mentioned earlier that the number of commercial accounts or commercial listed vehicles does not include attrition. Were you referring to the commercial accounts or the commercial-listed vehicles?

[Joe Furnari:]

Commercial-listed vehicles. Actually, retention of vehicle owners is actually increasing. I'm seeing that in our retention rate. So, that's a positive and that's, that's a testament to all of the back-end kind of support system that Henry and his team have helped set up with the internal operations, the restructuring of some of our sales agents, who are bringing on an outside or near short call center, all of that stuff is kind of attributing to better branding metrics that are customer retention, both on the driver and vehicle underside. And then, yes, the attrition or the churn of those vehicles and becomes car side of maintenance, et cetera.

[Jack Vander Aarde:]

Got it. Okay. Thank you, guys. That's all for me.

[Operator:]

Thank you. Our next question comes from Jon Hickman from Ladenburg Thalmann. Please go ahead.

[Jon Hickman:]

Hi. I know that giving the commercial side going with more and more commercial vehicles on the platform has been kind of a goal of yours for quite a while. It seems like you've kind of hit the secret sauce in the last, say, two months or so. Can you elaborate on what's changed or what's happened there to really get this side going?

[Scott Brogi:]

Yes. Well, it's been a monumental achievement from our outside and inside sales teams to get this commercial initiative up and running. And we've had to set up captive financing partners. We've had to set up garage insurance policies. We've had to help the dealerships through entity formation, vehicle registration, vehicles loaded to the site, and then teach them how to manage a rental car fleet.So, that effort has taken a little bit longer than I had expected. But I think we've – you alluded to the secret sauce, I think, we've hit the right type of dealer and that these are larger, hybrid type dealers that are used to running rental car fleets, or that already had rental car fleets set up.And so we're – we've kind of really shifted the focus from a marketing, from a lead-gen perspective to start focusing on those types of dealerships, because those types of dealerships Embracing Transportation as a Service, and they see the writing on the wall. So, that's been the shift from a more of a shotgun approach to more of a targeted sniper approach.

[Jon Hickman:]

Okay. So, sales personnel-wise, how many people do you have actually in this effort?

[Scott Brogi:]

It's about 30, 35 sales agents right now.

[Jon Hickman:]

And like six months ago?

[Scott Brogi:]

Six months ago, I think, we're probably around 20, 22, 23 or so.

[Jon Hickman:]

Okay, thanks. That's it for me.

[Joe Furnari:]

Thanks, Jon.

[Operator:]

Thank you. Our next question comes from Mike Grondahl from Northland Securities. Please go ahead.

[Mike Grondahl:]

Hi, guys. Just a couple more. So could you say just a little bit more, how did – you have two current OEM pilots. How are they going? And then it sounds like you're starting a third OEM pilot this quarter with, I think, you said several dozen dealers initially. Could you just provide a little bit more color on the two and then the new one?

[Joe Furnari:]

Yes, good question. So, the pilot running with a large domestic, they're asked was a earn-to-own program, standardized earn-to-own or rent-to-own type program. We are in process of rolling out that earn-to-own peace through dealer-connect. And so that's going to be – that that's a big chunk of, or that was a big piece of what they were asking for. So, rolling that out in the next 30 days or so and making sure that that is successful as a key to – is a key KPI to that pilot.

[Mike Grondahl:]

And, Joe, is that….

[Joe Furnari:]

Yes.

[Mike Grondahl:]

…one of the two you have life today?

[Joe Furnari:]

Yes.

[Scott Brogi:]

Yes.

[Mike Grondahl:]

That’s one of the two existing? Okay.

[Scott Brogi:]

Yes. That’s one of the two existing. The other one that was existing is still running. I think that we have a handful of dealerships that are participating. It's been a little bit slower than we had expected. And that's not because of the program. I think, that's more of internal internal restructuring there at that specific manufacturer. So, as soon as they get everything figured out on there, and I think we're going to be – we'll ramp that back up.And then the third pilot that we're going to be launching in Q4 is actually really exciting. We had them in our office a couple of weeks ago. They are looking to essentially use our back-end platform to rent cars through one of their high-end dealership brands. And I'm excited with that one, because it's a dozen initially, but really can ramp quickly into multiple. It's a little bit of a different move away from the traditional car sharing for ride sharing, i.e., renting to Uber and Lyft drivers.This pilot becomes more of a renting of cars or an extension of a leasing of cars through the high-end dealership. So I think margins are a little bit better, pricing power is a little bit better, et cetera. So that's – I'm excited about that. And I think that I'm hoping to be able to launch that in Q4 and then see where that goes into the…

[Mike Grondahl:]

And towards the end customer in that pilot, is it just the person driving the car, but not an Uber or Lyft driver, I didn't quite follow you?

[Scott Brogi:]

Correct. So, this would be customers coming off three-year leases. And this manufacturer-wise, you extend those drivers into 2020-2021 cars. So it's a – it's not an Uber or Lyft driver, this is a driver where they are – they were former customers or they are customers of that dealership and they're looking to provide a seamless brand experience into a newer model. And this is a way to kind of rent own essentially for that customer.

[Mike Grondahl:]

Got it. Four of that car coming off three-year lease?

[Scott Brogi:]

No, they're going to be – they would be leasing new cars for customers that are coming out of three-year leases.

[Mike Grondahl:]

Got it. And they’re putting those new cars on your…?

[Scott Brogi:]

So, they have access new car inventory sitting on the lot. They want to get those customers transition into those new cars. So, this is a way using our program to transition them into new cars. And then eventually they turn over, they turn over and sign new two, three-year leases. But this is a good way for them to essentially have an extended test drive in that vehicle.

[Mike Grondahl:]

Got it. Okay. And hey, the technology platform that you have and you've been fine tuning and adding things to it over the last couple of years, what shape is it in? Is there a lot more to go or what are the hiccups you're still working on?

[Joe Furnari:]

With the technology platform, a big part of the raise was to – so that we can bring in technology personnel. And so now we've recently hired a DevOps –a data [ph] engineer lead. We're looking at a couple of DevOps leads and we're building that team internally, because we do need to – we need to build out our capacity there internally. And so I'm excited, because it's been, I think, we see some light at the end of the tunnel there with the hiring side of things, and then it's get to work by accelerating our product pipeline.

[Mike Grondahl:]

Are the dealers happy? The larger dealers happy with the current technology, or more you need to do to help them?

[Joe Furnari:]

There is more than we need to do to help them. I mean, we've rolled out version one. And there is some – there are some enhancements that are being taken place. What's good is that, we have a great dialogue with the – with those partners, and we have a dedicated customer support rep. You have an outside team, you’ve got an inside team and all of them are soliciting feedback.I think we've done a good job over the past couple of years of creating this positive feedback loop from the front-office staff that then communicate those specs to the middle office project managers, project managers turn them into dev specs, devs execute on it, and then it gets rolled out. And then we get – we started that feedback loop all over again.So, I think that's actually one of the real benefits of our platform is that, we have that back-end support staff. We have the front-end support staff that's very unique in the industry. And so that's how we're able to really kind of actually develop here.

[Mike Grondahl:]

Got it. And then lastly, you got a sentence in the press release, it says revenues were also impacted by a reduction in driver incentives, seasonality and timing of commercial car supply on the platform. Can you quantify each one of those roughly?

[Joe Furnari:]

Quantify each one of those roughly. I don't have a real breakdown there. I think what happened was, it was really the soft days in the dealer cars, a tremendous amount of demand. But if we have had the cars, we still would have grown and we would have hit our targets. It was just that inventory came on a little bit later in the quarter. And so I don't have it really broken down. But I think you can look back at the quarter and look at the seasonality there to come up with those numbers. And that's something maybe we can do a takeaway as a follow-up to get you.

[Mike Grondahl:]

Got it. Thanks, guys.

[Joe Furnari:]

Alright. Thanks, Mike.

[Operator:]

Thank you. I show our next question comes from Rich Ehrlich from JH Darbie. Please go a head.

[Rich Ehrlich:]

Hi, Joe, nice quarter. I had a question regarding the amount of paperwork that a potential driver has to do now that you have the dealership model going forward. Do you have to do any additional paperwork between what they would normally do with you and now with dealership, or is it kind of seamless?

[Joe Furnari:]

Good question, Rich. I – it's different in the sense that it's actually a faster key exchange or you're seeing that they are – those dealerships have dedicated support staff that are there and available compared to, for example, a peer-to-peer, where you wouldn't see – that individual owner wouldn't necessarily be available during the day. And so, it's actually, it's reducing friction by bringing in these commercial vehicle owners to rent cars and drivers.

[Rich Ehrlich:]

Okay. Thank you.

[Operator:]

Thank you. This concludes our Q&A session. At this time, I'd like to turn the call back over to Joe Furnari, CEO, for closing remarks.

[Joe Furnari:]

Great. Thanks, operator. And yes, thank you again for joining us. I think, we've kind of alluded to what we're seeing in October, or what we saw in October, and I'm really excited about what Q4 and 2020 is going to bring. So, look forward to continuing to update you on our progress heading into 2020. And thanks, again, for joining us. That's it, operator.

[Operator:]

Ladies and gentlemen, this concludes today's conference call. Thank you for participating. You may now disconnect. Good day.