Serial entrepreneur Scott Painter’s plan to build an electric vehicle subscription company called Autonomy didn’t work out, so he’s returning to what he calls the “most difficult project” of his career.
While Autonomy will continue to operate the small fleet of 1,000 vehicles it has built up over the past few years—far from its stated goal of 23,000—Painter is launching a new company called Autonomy Data Services, or ADS, he tells TechCrunch in an exclusive interview.
The new company will provide a software platform and data for automakers that want to run their own subscription services for electric, gasoline, new or even used cars. Painter also says he’s in talks with auto dealers, fleet operators and even companies that sell construction and agricultural equipment but may want to offer subscriptions. He says an early version of the service is already generating revenue.
Painter says ADS is negotiating with several automakers, including three that have operated their own subscription service in the past. The company is working with Deloitte to operate the service; ADS, as a software-as-a-service provider, will receive a share of revenue, while Deloitte will charge automakers (or other clients) for customizing the platform.
It’s another turnaround for Painter, who has had a difficult few years. After stepping down as CEO of auto dealer TrueCar (a company he founded in 2005) in 2015, he founded car leasing startup Fair, which raised over $300 million from SoftBank. That ended badly, with early investors accusing SoftBank of bankrupting the company, and Painter eventually resigning as chairman in 2021.
His recent turnaround was not easy either.
To make all of this possible, Painter first had to convince Autonomy’s investors. Some of them were completely overwhelmed because the subscription service never got off the ground as promised.
“Our lenders had what’s called senior secured status; they could have bankrupted the company and tried to liquidate the fleet” to get some of their money back, he says. But he worked with them to convert $32 million worth of Autonomy’s debt into equity in ADS.
He also says he had to “dig deep into his pockets personally,” including selling a $6 million beach house on Pacific Coast Highway, taking out a mortgage on another property and “selling a lot of assets I didn’t want to sell.”
“It was the hardest build I’ve ever experienced as an entrepreneur,” he says, describing the entire process as “hugging the cactus.”
A six-figure acquisition for data
Autonomy already struggled last year when Elon Musk’s aggressive price cuts destroyed the value of its small fleet of mostly Teslas. (Painter, who knows Musk personally, says he tried in vain to “make Elon understand the importance of being more predictable with discounts.”)
The problem this time is that almost every major automaker has already tried subscription services. And almost every single one of them has abandoned the idea.
Painter says that happened because automakers “didn’t have the reliability or understanding of how subscriptions would work.” Because all of these automakers’ subscription services were brand new, he says, they didn’t know how customers would behave. Would they subscribe for just a few months? Or for a few years?
Without this information, it’s really difficult to set prices, Painter argues. That’s why automakers charge high prices for their subscription services – which scares away buyers.
He plans to offer such information with ADS, among other things. And it doesn’t just come from Autonomy customers. Earlier this year, Painter quietly bought the assets of the bankrupt used car marketplace Shift Technologies for less than a million dollars. In the years before the collapse, Shift had bought Painter’s former car leasing startup Fair, which had previously acquired Ford’s subscription service Canvas – thereby regaining ownership of the remnants of his former company – as well as Uber’s leasing service Xchange.
The data from all of these companies can be used to predict “how long people stay in cars depending on their customer group, what their FICO score is, what their income is, and so on and so forth,” Painter says. This is important not only because it provides security, but because the flexibility of subscription services is attractive to customers with lower credit scores.
Painter says that in addition to the customer data, he also obtained all the source code, patents, trademarks, and compliance and legal documents of these defunct companies. This, he says, will make it very easy for ADS to successfully work with customers in new markets.
In total, he says, he got more than a terabyte, jokingly calling it an “amazing avalanche of shit.”
“My IT people were just wondering, ‘What am I going to do with all this stuff? It just kept coming in,'” he says. But he points out that the companies that generated all that data “collectively spent nearly a billion dollars developing software” that he now owns and uses at ADS.
“I mean, if (SoftBank CEO) Masayoshi Son finds out that I was able to buy all of Fair’s intellectual property and assets for less than a million dollars, it will just kill him,” he jokes.
And although he has raised $2.5 million to fund the venture, the work is not done. “We have done everything we needed to do to make (ADS) an investable company. Right now we are just looking for an equity partner to contribute between $5 million and $8 million,” he says. “That gives the company two years to start up and then continue to grow with Deloitte.”
