Bring A Trailer Co-Founder & President Randy Nonnenberg joins Yahoo Finance Live to discuss the access to vintage and collector cars his online marketplace provides, the authenticity and transparency the site offers to collectors, and the culture of car collecting.

Video Transcript

- All right, people who are nuts about cars or describe themselves as car nuts are probably familiar with Bring A Trailer. In the old day you had to go, say, to eBay to sell your car or even to an old fashioned auction. We just had an old fashioned auction through Mecum, and they had billions-- not billions, millions of in sales. But the industry as a whole is worth billions.

And that's where Bring A Trailer comes in. They were founded in created in 2007. I wish he'd been around in 2006. I had to sell to Studebakers on eBay. But let's talk about where they're headed, because they are having a banner year. I think a $2 million Porsche just sold. Randy Nonnenberg is Bring A Trailer Co-founder and President.

Pras Subramanian is my fellow car nut. I wish you were around in 2006 because I think I took a hit doing it on eBay. Let me throw the first question out to you, though, Randy. What is the attraction, for those of us who like to consider ourselves car nuts, to being able to do it all on your platform?

RANDY NONNENBERG: Well, thanks for having me. Yeah, a lot of that attraction is just the sort of treasure hunting that people get to do. And that's popular in many different enthusiast segments, whether you're into jewelry or fine art, or we happen to be cars. And for the types of cars that we list, which are special things, one off things, what falls into the enthusiast segment, finding the right one to come up is what causes people every single day to come back to Bring A Trailer.

PRAS SUBRAMANIAN: Hey, Randy, Pras here. I have a lot of questions. But sort of big picture here, you guys had a huge year last year, nearly $1 billion in sales. What do you think's driving this big boom in collector cars right now?

RANDY NONNENBERG: There's a boom in collector cars overall. Some of that was supercharged by the pandemic. But some of that is just people refocusing based on the macro financial environment and wanting to see them as investments. A lot of people see collector cars as a scarce item. And it's one that you can actually invest in and at least break even, if not make money in, while also enjoying it at the same time, in a way.

It's harder to enjoy a stock or a gold investment, something like that. So a lot of people use these and park them and care for them and dote on them. And their enthusiasm, as we have helped it to grow, makes that for something that can actually be a meaningful investment for them.

PRAS SUBRAMANIAN: So Adam mentioned just earlier about this the $2 million Porsche Carrera GT that sold this week, a record amount for that car. Do you think the market is-- there's a lot of enthusiasm. But is it getting overheated. When I talk to small collectors, even big ones, they're a little dismayed by how high these cars are and how they can't get in. What do you think about that?

RANDY NONNENBERG: Well, certainly, I mean the big ones like that $2 million Porsche you're showing right now certainly get the headlines. But interestingly, the average sale price of a vehicle on our site last year was about $35,000 and did boom to $45,000 but there's not really a narrative that all of these are going to be $1 million and this is only a rich person's game.

You ask what makes people come to Bring A Trailer, one of the main attributes is the variety. And there's things transacting every single day for $20,000 and less that people can sort of get into it at every level. There's kind of something for everyone. But is it overheated? There's a lot of people that are really excited about it and aggressive, and like I say, using it in that sort of investment language, as opposed to enthusiasm and hobbyist language.

And thankfully, there's enough vehicles out there. We listed 22,000 vehicles last year, which was a 57% increase over the previous year on our online platform. And we see that much growth again. And there are millions of interesting vehicles that are out there already on the road. And then manufacturers these days are still producing some interesting ones as well.

- Randy, this is Emily here. I want to dive a little bit deeper into what you were talking about with accessibility. And have you seen recently any shift in demographics in who's purchasing these cars on your platform or participating in car auctions even more broadly? Or has that target audience really remained relatively steady?

RANDY NONNENBERG: That's a super good question. And I think that on our platform, what we have let people do is do it in their pocket. I think the older environment of having to go to a physical car auction, how many people have done that? That's only really industry people or really deep collectors and that sort of thing. Most people never do that.

But with our platform being purely online, the accessibility has just ballooned. And people that are coming into the hobby, if they call it that, or even just looking to transact for their next vehicle, are using our site to be able to do that. So I think we have expanded that sort of accessibility.

And so that has made it shift maybe a little bit younger, more technologically savvy, have different sorts of expectations around their life, around vendors like Amazon, as opposed to their life with vendors like a traditional car dealer. So there are different sort of features and conveniences that are both expected and helpful for the market. So that has led to a shift in a different type of buying audience.

- You're also providing, though, on the platform the kind of data that people who, you call it the hobby, I'll call it the frenzy mania. And I'm looking at the page right now. And I put in Studebaker Avonte. And you get the data, real data, on what certain cars that might not have sold but got bid up to and then those which sold.

And unfortunately, we just saw one go for $83,000, so out of my wallet's range. But that's really valuable to not only the buyers, but the sellers. How often do you have to explain to a seller, because you work with the sellers when they list the car, be realistic about the price?

RANDY NONNENBERG: Well, data helps it no longer be mysterious and no longer be based on opinion. The car industry and the collectible car industry for so long was held tightly by a small group of experts. And you kind of had to succumb to whatever they said. And now people have a much greater expectation for transparent data. And we wanted to push that forward.

So our platform, yeah, every single listing, we've listed over 60,000 vehicles on Bring A Trailer, and all of those are permanent. So you can go see the permanent record of all of those in scatter charts. And you can see all that data. And we kind of model that after sort of a Zillow type marketplace, where if you really want to find comps and understand what this is going to take and why one is valuable and why one isn't, we think that's positive.

And that sort of transparency is through the entire site and everything that we try to do, because we think that's something that hasn't been in the industry before. So that is that's fueling a lot of the visibility of our site and usefulness of our site to users.

PRAS SUBRAMANIAN: Hey, Randy, real quick two parter here. What's next for Bring A Trailer? And also give me one undervalued car that I should keep an eye on.

RANDY NONNENBERG: Oh, good one. What's next for Bring A Trailer is more just trying to let more and more people use this sort of platform. And I think the online trust and the online reach have both been things that people were dipping their toe into as sort of first timers. But it's really starting to be the norm now, now that cars, seven figure cars, can transact there, as well as $5,000 cars.

People are seeing it as more universal, where previously, it might have seen more niche. So I think our platform is going to see more growth in this year and the coming years. And just in terms of adoption, it will become the regular and first choice place to go. So that's in our favor.

In terms of what cars are available, I mean, there are so many different types of models and makes that are out there. I don't know whether you're into sports cars, or vintage four wheel drives, or European or American stuff, but I think that there's been these crazy booms, this hot, hot market for European cars and trucks and those sort of things.

I think American muscle cars have sort of trended a little bit behind that. So a lot of people think, oh, everything's so expensive these days. But you can still get pretty iconic American VA cars from the '60s, like a '65 Mustang Coupe, yeah, sure, it's not $10,000 anymore. But it's probably $20,000 or $25,000 now for a car that is just amazing, Americana. And it hasn't run away the way some of these other ones have.

- Randy, I'm going to throw in my worthless opinion here, because I've been on your site, and I've been on other sites. To answer process question, you know, it's not you. You're Mr. BMW, Porsche. But--

RANDY NONNENBERG: Oh, easy. I can answer that part for you.

- If you want Lincolns from the early '70s, it's blowing me away. Like the car they drive in "Schitt's Creek," people are paying $25,000, $30,000 grand for these Lincolns, these land yachts. But that's another discussion. Pras, you and I'll grab a scotch and talk about going to get a '72 Lincoln. Randy Nonnenberg, Bring A Trailer Co-founder and President, thank you so much for joining us. Pras, see you in just a bit.