The biggest problem with Vroom (and its peers) from a business perspective is that they’re trying to operate a two-sided marketplace with incredibly low margins

The biggest problem with Vroom (and its peers) from a business perspective is that they’re trying to operate a two-sided marketplace with incredibly low margins. On the sell side they’re competing with Carmax and co., which means they’re trying to win the most price sensitive customers which will inevitably lead to the smallest margins. On the buy side they’re trying to offer a better experience than dealers which means lower profits at similar prices. Add to this that the economies of scale don’t really help for used car dealers, and you’ve got a business that’s primed to fail.