When the founders launched WeBuyCars (WBC) in 2001, Dirk and Faan van der Walt had a passion for selling cars. Faan had an eye for a bargain and Dirk was the marketing expert. But money was tight: Faan had made an initial investment in WBC from money earned teaching in the UK, so they could only afford to buy a couple of used cars at a time. 

It was slow going at first. 

Faan, now CEO, says he recalls Dirk, who studied marketing and is their chief strategy officer, had dreamt of selling a car a day – 30 cars a month. By the end of 2001, they had sold 120 cars, largely driven by word of mouth and advertising in newspapers.

In 2023, WBC sold more than 150,000 vehicles, motorbikes, trailers, boats and caravans. 

Last week, WBC holding company, Transaction Capital, announced WBC would be listed separately on the JSE in April.

The brothers Van der Walt were WBC’s first employees, playing it safe by making the right purchases, staying in the bottom end of the used car market and reinvesting their profits in the business. 

They never paid themselves salaries, taking only what they needed to get by, and never had to go to a bank to beg for money. 

The brothers would drive around with bags of money and contracts and do the registrations and repairs themselves, which helped them to develop a solid understanding of market dynamics and what it takes to buy and sell cars.

Dirk, WBC’s dreamer, envisaged a billboard on the N1, but not just any billboard: it needed to show intent, so the brothers posed with money in hand, telling customers that they wanted to buy their cars. 

It was the branding that served WBC for years and made them a household name.

Their biggest challenge at first was price discovery; to understand what vehicles were worth.

“There wasn’t any internet, so you had to know your stuff. We limited the brands because we knew those brands, and we started at the bottom end of the market because that’s what we could afford,” Faan told investors on Friday.

Those early years have engendered a great appreciation for the bottom end of the market, which serves WBC well today. 

Faan told investors that after the first decade, as they got busier and busier, Dirk insisted that they needed a website. “I said, ‘Why?’ He said, ‘Trust me, we need to get a website’.”

An online presence was critical, helping people in other geographies to find cars through the platform and generate leads. 

“All of a sudden, we found ourselves on planes buying cars across the country. And that’s when we knew we had to scale this business.”

Growth was organic.

It took nine years before they built their first car warehouse – or “supermarket” – in Pretoria East, with capacity for just 100 cars. 

By 2012, WBC appointed its first buyers, which helped them scale their business nationally. This was the turning point —  trusting someone else to do the job they loved.

In July last year, it acquired the Northgate Dome, which can accommodate 2,000 cars and sells the same number each month. There are 14 other warehouses in Gauteng, Cape Town, Gqeberha, George and KwaZulu-Natal, nine of which belong to WBC, and 74 “buying pods” in shopping malls dotted around the country. 

WBC opened its Midstream Supermarket in 2017 — Africa’s biggest car showroom sold 16,435 cars and sold a minority stake to Transaction Capital. 

Since 2020, when Transaction Capital acquired a 49.9% non-controlling stake in WBC, the company has doubled its sales. 

Last month, WBC sold more than 14,006 cars, including 3,500 to dealers. 

In four years, they doubled in size and volume, Faan said. 

“This momentum has been the same since we started and it’s gaining traction. We plan to see that continuing into the future.”

Business is so buoyant, they expect to take up to 12% of South Africa’s used car market by 2028. 

WBC data shows that when someone buys a new vehicle, they keep it for about five years. If they buy second-hand, they hold on to it for three years. 

The used market is also much more stable than the new market. 

With about 11 million vehicles on SA roads, and a further 600,000 new vehicles entering the market each year, WBC is banking on a growing car pool.

The second-hand vehicle market in South Africa is buoyant — thanks in large part to the cost of living crisis that is driving customers to buy affordable used vehicles, instead of new. DM