Indianapolis tech startup Overfuel acquires competitor
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Indianapolis-based tech startup Overfuel Inc., which launched last year with a platform for auto dealers, says it expects to become profitable next month in part thanks to its recent acquisition of a competitor.
Overfuel has acquired Washington state-based 321 Ignition, which was founded in 2018. The deal closed Aug. 17. Overfuel declined to provide details on financial terms. The combined company now has about 25 employees, including 15 who joined the company as a result of the acquisition.
Overfuel’s platform allows independent auto dealers—typically, used-car dealers—to improve the customer experience on the dealership’s website, while also giving the dealers access to more data and analytics about those customers.
The Overfuel platform is an alternative to the typical way dealers build their websites. Under that typical scenario, dealers work with patchwork of different vendors: one for the website itself, a different vendor whose widget enables potential customers to fill out online credit applications, a different vendor that enables customers to make online down payments, and so on. The result can be a jumble of pop-ups, chat boxes and visual clutter.
“I think we’ve all gone online car shopping and wondered how it’s such a poor experience,” said Ryan Pfenninger, Overfuel’s CEO and co-founder.
In contrast, Overfuel’s platform allows dealers to offer multiple features on their websites without the need to use additional vendors.
Similarly, 321 Ignition also offers an online platform aimed at independent auto dealers.
“In many ways, they’re very, very similar to our business,” Pfenninger said. “We were direct competitors until we did the deal.”
In fact, Pfenninger said, he and his co-founders had tried to acquire 321 Ignition last year, but the two companies couldn’t reach an agreement on terms. The two companies reconnected several months ago, and this time an acquisition happened.
Pfenninger’s three Overfuel co-founders are Alex Griffis, Paul Fearnow and Peyman Rashidfarokhi. Pfenninger, Griffis and Fearnow all previously worked together at Exit 31, an IT consulting firm that merged with Indianapolis-based email management software firm 250ok in 2016. In early 2020, 250ok was acquired by Boston-based Validity Inc. Rashidfarokhi has a background in auto sales—he and his brother, Amir, own the luxury used-car dealership Fishers Imports, which has locations in both Fishers and Indianapolis.
Overfuel, which landed its first paying customer in March, now has more than 100 customers as a result of the 321 Ignition acquisition, Pfenninger said.
Between that and the cost savings of combining the two companies, Overfuel expects to achieve profitability for the first time next month, Pfenninger said.