The Car Warranty Chaiz: Reto Bolliger with Harm-Julian Schumacher
Reto Bolliger, co-founder and CEO of Chaiz chats with Harm-Julian Schumacher, co-founder and CEO of OneLot on episode 108: The Car Warranty Chaiz.
The host of episode 108 of Venture Everywhere is Harm-Julian Schumacher, founder and CEO of OneLot—a financing platform for used car dealers in the Philippines. He talks with Reto Bolliger, co-founder and CEO of Chaiz, an online marketplace for extended vehicle warranties. Reto shares how climbing Kilimanjaro led him to build a travel company, and how an investor in that business introduced him to the surprisingly profitable world of extended car warranties. He discusses how Chaiz challenges the industry consensus that warranties “must be sold” through aggressive tactics, instead building trust through transparency and offering consumers prices up to 40% cheaper than dealerships.
In this episode, you will hear:
Building the first online marketplace to compare and buy extended car warranties.
Offering dealership products at 40% lower prices through digital channels.
Replacing aggressive sales tactics with transparency and education.
Leveraging AI for customer support and AI search optimization.
Embedding warranty APIs for cross-selling through partner platforms.
If you liked this episode, please give us a rating wherever you found us. To learn more about our work, visit Everywhere.vc and subscribe to our Founders Everywhere Substack. You can also follow us on YouTube, LinkedIn and Twitter for regular updates and news.
TRANSCRIPT
00:00:04 VO: Everywhere Podcast Network.
00:00:14 Jenny Fielding: Hi, and welcome to the Everywhere podcast. We’re a global community of founders and operators who’ve come together to support the next generation of builders. So the premise of the podcast is just that, founders interviewing other founders about the trials and tribulations of building a company. Hope you enjoy the episode.
00:00:33 Harm-Julian: Welcome to the Venture Everywhere podcast. I’m Julian. I’m the founder and CEO of OneLot. We are a financing platform for used car dealers in the Philippines. We are building around the used car dealers who are the backbone of the market and support them with credit solutions, software and data.
00:00:53 Harm-Julian: Today, I’m here with Reto, the co-founder and CEO of Chaiz. They are a marketplace for extended vehicle protection. Reto, why don’t you go ahead and introduce yourself?
00:01:05 Reto: Thank you very much, Julian, for the introduction. It’s nice to be here on the Venture Everywhere podcast. As a brief introduction, my name is Reto, as Julian mentioned. I’m from Switzerland, traveled the world for about 15 years, built multiple companies. My latest venture is called Chaiz. It’s an online marketplace for consumers to buy extended car warranties.
00:01:30 Reto: Traditionally, extended car warranties have only been sold at dealerships. We built the first online marketplace where you can buy exactly the same product, but you can compare them, buy them online. We are on average about 40% cheaper if you buy them directly online rather than at dealerships.
00:01:49 Harm-Julian: Thanks so much, Reto. Let’s start with your background. You have been very entrepreneurial, but you did stuff in the travel space, in music, and now you’re in the car industry. Tell a little bit about that and how you came to do Chaiz now.
00:02:04 Reto: I had indeed a bit of a back and forth in my CV. As you mentioned, I actually started studying classical music then got into finance. I worked for Goldman Sachs for six years in London, but I always wanted to be an entrepreneur.
00:02:17 Reto: While I was working at Goldman Sachs, I was climbing Kilimanjaro with a few friends. I liked that experience so much that I started my own Kilimanjaro operator. So I quit banking and built an adventure travel company, which was my first successful company.
00:02:35 Reto: One of the investors in the travel business, his name is Dan. He is an entrepreneur himself and he owns car dealerships in the US. Through him, I got in the car industry. I figured out that car dealers actually make more money with selling F&I products like car warranties than they do with selling cars. That piqued my interest.
00:02:56 Reto: That was about seven or eight years ago. It was the trigger to dig more into the industry. Generally, I’m just very excited about new industries and digging to learn new things. That was part of the reason why I always look for new things to dive into head first.
00:03:13 Harm-Julian: You said you always wanted to be entrepreneurial. I see some overlaps with myself. I always had that, but I also started off on a corporate track. I did Bain in the beginning to then eventually down the entrepreneurial road. You talked, your first successful business was a Kilimanjaro tour operator. Where was this entrepreneurial drive coming from?
00:03:32 Reto: I don’t know, actually, but I have a lot of ideas. A lot of them are not good ideas, but I just love to test ideas in reality, I’m very convinced that they’re good. And then I just want to go in and execute.
00:03:45 Reto: The Kilimanjaro was one of these examples. We were climbing the mountain and we thought we can do that better. We just started it and then figured it out along the way. What triggered yourself to make the move if you always wanted to be an entrepreneur or it’s like one big opportunity that prompted you?
00:04:01 Harm-Julian: Very family driven, where we have a few entrepreneurs in the family. Also from young age, always liked work, tried out ideas, selling things at school. During university, I co-founded a conference there, like a recruiting company.
00:04:17 Harm-Julian: I felt like before starting something, I want to learn the craft. Then that was for me like Bain, learned that. And then I felt more confident to actually start something. One thing you said, which I find quite interesting, you have a lot of ideas, but not all of them are good ones. What you hear in the industry is ideas are easy to come by. It’s not about the idea.
00:04:38 Harm-Julian: I actually disagree. It’s not easy to find a really great idea and especially a venture, scalable one. Around the example of Chaiz, you said you got introduced by your investor. How did you go by to validating this idea and doubling down on dedicating the next 5 to 10 years of your life to that?
00:04:57 Reto: I would agree with premise, an idea is not a business in particular. I made that experience myself. The travel business is the perfect example that you can’t venture scale a Kilimanjaro operator.
00:05:08 Reto: Back then when I started digging into the extended car warranty business, I took a lot of the learnings on board from my previous venture company that I’ve built, looking at the idea with more of a business eye. You look at does the idea scale?
00:05:24 Reto: The problem with travel, for instance, it’s very driven by local operations, whereas an extended car warranty is like a financial product. So once your funnel works, if you sell one contract or a million contracts, marginal costs are very limited.
00:05:40 Reto: So I approached it very differently and I did way more research. So before I founded the business, I interviewed all the stakeholders in the industry, like car dealerships, looked at the call center sellers. I spoke with the providers of the plan.
00:05:53 Reto: My friend was very helpful there as well to make that introductions and learn and understand, is this a business that can reach venture scale? And then at some point I decided, yes, it actually can. And only then I pulled the trigger.
00:06:07 Harm-Julian: How do you then approach the first year? Did you go like, Hey, this is a total market and I want to immediately tackle that fully, or did you solve one very small specific problem? Tied to that, the question for a marketplace is also this demand and supply problem. Talk us through there in the beginning. What was the problem you solved or did you go directly after everything? And was it more hard to get demand or supply?
00:06:30 Reto: For the supply side of the marketplace, for them, we are just another seller. The only difference is we’re not a car dealership, so we do sell it digitally. For them to say, yes, I want to be on the marketplace, even though there might not be immediate customer flow from day one, there was a pitch that we were able to make.
00:06:52 Reto: The first few were difficult, first five, just to convince them that this is where the world is moving, that people start buying more things digitally, the industry will get more transparent. So they had to buy into this hypothesis.
00:07:07 Reto: Once we had the first five and we launched, it was really just about how to get customers on board. That was the main challenge. At some point it even flipped. At the moment we do have a waiting list of providers that want to be listed on the marketplace, and we can just onboard maybe one a quarter.
00:07:25 Reto: This is an interesting thing that we observed. More and more of these providers understood that just selling through dealerships might, in five years time, be different or might not be all that is in the industry. A lot of them realized that they have to be more transparent. They have to be able to sell digitally as well. So I think that triggered the shift, which we’re in a lucky position that the supply side now is really easy to scale.
00:07:52 Reto: But the demand is the tricky part. Every consumer business knows it’s difficult to just go grow 3x, 5x year over year on a B2C level, or there’s usually not a clear script how to do that.
00:08:06 Harm-Julian: As I understand the market, traditionally these extended warranties were sold by the dealer at the point of sale of the car. Then you had a next wave coming in, which was more outbound call center, calling consumer and over the phone trying to sell those, which really backfired at one point and created some negative consumer reaction because those got too aggressive.
00:08:26 Harm-Julian: Now you are trying to solve this by… digitally, consumers who are actually looking, capturing their demand and channeling them into your business.
00:08:36 Harm-Julian: I just find that very interesting because it’s similar for us. We really focus on the dealer. You are actually focusing more on your own channels, moving things away from the dealer. How do you see this evolving between the three different channels?
00:08:48 Reto: If you carve out just the extended warranty part of it, it’s an industry that is going to evolve similar to other industries with some differences, but car insurance could be an example with the difference that car insurance is mandatory and warranties are not. In a car insurance, you have digital sellers. And then at some point the marketplaces came up. Nowadays, most people do comparison shopping online.
00:09:12 Reto: What you will see is more and more business will move online. That’s a trend that’s probably not too controversial to say. What we do is in the first instance, we’re not really going out there convincing people that they have to buy the warranty.
00:09:28 Reto: So we have to tailwind from call centers and dealerships that tell people you should buy this product. It’s a good product. We basically just show them, Hey, there’s a better way to buy. It’s ultimately a $3,000 contract or even more. Every purchase that is in a high ticket item, you should do some research and compare different offers.
00:09:47 Reto: We just plug in when people already know they want to buy the product. Over time, this will evolve. At a certain scale, we will be able to influence the narrative and the reputation of the industry more. That comes back to what you said that some of these call centers had some negative impact on the reputation.
00:10:05 Reto: Once we dominate the inbound part, we’ll have enough firepower to start controlling the narrative more and explain to people that it’s actually a really useful product as long as you buy it at the right price. That’s how I see the car warranty industry evolving, including us as an agent in there.
00:10:23 Harm-Julian: So at the moment it’s very focused on, Hey, there’s a clear intent to buy. A used car dealer told me this is good, but since it’s quite expensive, I’m going online and comparing anything and this is like where you’re capturing the demand. Interesting.
00:10:37 Harm-Julian: Let’s look ahead a little bit. You touch upon that one already to do more education around car warranties. This is a useful product. What are other goals or aspirations for the future? How do you plan to achieve them?
00:10:52 Reto: The overarching mission is really to reform the car warranty market. I believe it’s an extremely useful product. A lot of people in the US don’t have savings. If the car breaks down, they’re basically in debt. But it hasn’t been sold the right way. If we manage, in five years time, that most people actually have protection on their vehicle and they bought it at the right price, that would be a great achievement.
00:11:16 Reto: Beyond that, there is a lot of SaaS enabled opportunity in the industry as well. So we have all the supply on our marketplace and there’s tons of products we can build to make their life easier or like talking about claim handling rates, pulling all these types of things.
00:11:33 Reto: On the front end, being a household brand that explained to consumers that this is a great product, if bought at the right price, that would be the success. And then further in the industry, there’s a lot of blank canvas to paint on when it comes to building new technologies and giving new tools. It’s a very antiquated industry with almost no working APIs.
00:11:54 Harm-Julian: I can definitely relate to that. In particular, also the used car dealers, in my experience, they’re not the most tech savvy guys. Our process is evolving around enabling them on the ground even more because they are the ones who are like very much own the entire industry. They’re the backbone. They are the ones buying cars, fixing them, making them look nice, selling them again. A lot of consumer to dealer to consumer transactions.
00:12:19 Harm-Julian: We are also thinking about AI agentic use cases where we can meet them in their natural channels. This might be, instead of giving them a website or a digital form or an app, which they have to fill out, meet them in WhatsApp because these are the natural messaging tools they use anyways. That is a big hypothesis we are working on to make usability higher, increased conversions, increased demand.
00:12:46 Harm-Julian: Particularly looking at your technology, you said that it’s a traditional industry. How do you think about the technology or like the new AI use cases? What are really the applications you see and how is it changing the industry?
00:13:00 Reto: For us, what we keep the closest eye on in terms of AI, I think probably every consumer business should do that is the AI search and AI commerce like how consumer behavior changes, how they discover products.
00:13:14 Reto: An example, Google search on SEO was the big thing 5, 10 years ago. Now a lot of content marketing strategies are eaten up by AI. So people go search and research in ChatGPT and other tools. That for us, a very important driver that we constantly monitor. As soon as there’s potential to advertise in AI tools, et cetera, as a consumer business, we need to be quick to check things like that out.
00:13:42 Reto: On the more backend type for our industry, the straightest line is probably in customer support. We still handle the customer relationships. So even after the sale, we still have customers calling in. If they have questions about 30% of our sales are assisted. So someone calls in, asks a question.
00:13:59 Reto: Voice AI is kind of starting to work now-ish. There’s still to be seen which are the main players that are going to win the race. We haven’t implemented yet. We wait to see which is the right tool to use. But I think in the next few months, a lot of customer support can be automated.
00:14:16 Reto: The right strategy is you need to focus on your data. Have like a really good structured data set with all the information and then how you present the information via different tools to the consumer, be it via voice AI, via chatbot, via email automation.
00:14:32 Reto: You can just stack the tools that exist over the data if you have a really clean data structure. That’s currently how we think about it. Operational efficiency for us, plus how consumer discover product, are the main ones.
00:14:46 Harm-Julian: For us, the use case are a bit different, especially on the financing side. We actually believe that leads you are getting via the dealers directly versus the leads you acquire purely online have different quality. It’s like, who’s the customer you want?
00:15:04 Harm-Julian: Is it the customer who’s like, “Hey, I want to have this car.” And then as a secondary motive, I’m like solving financing because while that’s not a big problem for me, there’s someone who’s going online and actively looking for loans and then think about the car. So you have different qualities there, which why customer discovery for us, less relevant. That is coming lead generation via the dealers.
00:15:25 Harm-Julian: But then how do we serve the dealers? And there’s more touching upon your customer support point. That is absolutely correct that you’re like, well, they can just chat. They don’t have to push the information to any structured way.
00:15:36 Harm-Julian: You can then read it out always on, always available, fast response times, but at the same time also make sure these data points, regardless if they type it out or take a picture and send it, are being processed in a way which gives you a high data accuracy and at the same time levels up the productivity of your team. Really around the customer experience in that sense and what they like instead of forcing them into use cases of apps, which is not something they really easily do.
00:16:07 Harm-Julian: I have this one question. Chaiz technology can be embedded across multiple verticals? Tell us about the technology and different use cases.
00:16:14 Reto: We started as a pure B2C company. Over time, we got a lot of inbound demand for other players that wanted to sell or cross sell warranties. As one example, we launched with an insurance agency or insurance marketplace. They sell car insurance.
00:16:32 Reto: They now use our API to pull warranty quotes and the agents now cross sell warranties, so they would sell car insurance quote and then if the customer buys, they say, do you also want a warranty on top? And then they use, through our API, the quoting, the contracting, all that things, so that’s the embedded angle to it. So it’s for distribution partners.
00:16:52 Harm-Julian: So this is completely unrelated to your own front end and customer facing. This is really the backend you’re giving as a service to other brokers, marketplaces, who do it more in an offline way. It’s probably a bit of a stretch now for everyone to like go from that into that.
00:17:10 Reto: It’s just another distribution strategy where people embed our technology, sometimes also in car marketplaces or platforms where they transact cars.
00:17:19 Harm-Julian: You have been talking about consumer trends and one thing you emphasized was also discovery, how that is influenced by the new AI tools, how people using it to educate themselves. Talk in general about consumer trends, the AI topic and maybe other things you are closely watching at the moment.
00:17:39 Reto: What we noticed is a lot of Google traffic is now lost to AI tools. Probably everyone that is in a consumer space knows that. So the question is, what is the new SEO? Then a lot of people talk about AI search optimization.
00:17:53 Reto: In the next years it will crystallize what this actually means. I don’t think anyone has the perfect definition. There’s a few hypotheses or ideas that work and one of them works, regardless if it works on AI search. What I mean by that is having a strong brand, consumer business is even more important than it used to be.
00:18:15 Reto The AI models have a consensus probabilistic approach. They’re not going to suggest a very long tail result. They always go with, if everyone else says it’s good, then it’s good. The question for you as a brand is, how do I make AI models perceive my brand as the best brand? That usually goes in hand by you just build a good brand.
00:18:38 Reto: For us, collecting reviews from customers that really enjoy what we’re doing, being patient, building the brand, it’s the right thing from a business perspective and will also in the long run be a winning strategy on AI. That’s one example that we have a very strong focus on.
00:18:54 Harm-Julian: Building the brand. I think every consumer founder agrees with that. But now in particular with the AI models, what does it exactly mean? If you would recommend three things to a founder who’s thinking about that, what would that be to get visibility in those models?
00:19:10 Reto: It’s important that your brand is also visible in the online marketplace. If you do the right thing, make sure that your consumers actually write a review for you on Trustpilot, Google, or they talk about you on Reddit. Reddit is famously used for training models.
00:19:27 Reto: Make sure that other publishers talk about you in a positive light. The more touch points you throw out in the digital world, the more signal the AI gets. So building the brand, but then also making sure that it’s talked about. These two ingredients are important.
00:19:44 Harm-Julian: Thanks. That’s helpful. You just said it, this is….. understanding and searching is moving away from Google and shifting more into ChatGPT, Gemini, Claude, whatever it is, not super controversial.
00:19:57 Harm-Julian: At the same time, you are saying about yourself, you gravitate towards contrarian ideas. Share one example of where such a contrarian belief has really helped you. Where does it really impact your journey as an entrepreneur?
00:20:12 Reto: In the car warranty industry, in the initial interviews that we did with call centers, dealers. Everyone just used exactly the same tagline, and that’s always a sign. Everyone said, “Warranties have to be sold.” And by sold, they usually meant car dealer, call center type of selling, scare tactics, being pushy, chasing people. Everyone in the industry agreed with that.
00:20:38 Reto: There is probably some element of selling because the product is not mandatory as opposed to insurance. If you have to have insurance, the drive to buy it is different so there has to be an element of selling. But selling doesn’t necessarily mean hounding people over the phone and chasing them until they buy.
00:20:56 Reto: Selling can also mean explaining the value of the product, showing them that they actually get a good deal, make them trust you, show them transparently what’s in the plan and what’s not. So we thought about the wholesaling process from a more first principle basis. That laid the foundation of the company.
00:21:15 Reto: Contrarian can be good or bad. Sometimes people are just contrarian for the sake of it. A lot of times the ideas that seem contrarian become the new norm oftentimes. Not always. Sometimes it’s really just about questioning the status quo, but I think it’s necessary.
00:21:30 Reto: If you go with the consensus, you’re probably right 9 out of 10 times. But the one time where the contrarians are right, this can be the 10X, 100X outcomes. I think that’s the beauty about startups and venture world as well.
00:21:43 Harm-Julian: Thanks so much, Reto. Let’s do a quick speed round. What’s a book you’re reading or a podcast you’re enjoying?
00:21:51 Reto: More of a podcast guy. If anyone wants to hear a very bullish version of the future, I can recommend the Moonshots podcast with Peter Diamandis. So if you like to dream about flying cars and robots in two years, that’s the way to go.
00:22:05 Harm-Julian: Cool. If you could live anywhere in the world for one year, where would it be?
00:22:11 Reto: Japan. Had that on my travel list for a long time, but never managed to go there. So I would go to Japan.
00:22:16 Harm-Julian: Japan is awesome. I’ve been there the first time also recently. Great food, great culture, everything works. Great metro system. For me, it would actually be South Africa, where you are now. What’s your favorite productivity hack?
00:22:31 Reto: With the massive margin, probably fix your sleep. If you have good sleep, the quality of output and decisions is extremely high.
00:22:40 Harm-Julian: Lastly, where can listeners find you and follow you?
00:22:44 Reto: I’m just active on LinkedIn, so always love to connect with new folks, like founders, investors, et cetera. So LinkedIn is my favorite platform. Are you on LinkedIn as well, mostly?
00:22:55 Harm-Julian: Yeah. I deactivated all social media. I’m doing LinkedIn and X still for consuming information and getting views.
00:23:05 Reto: Why did you delete everything else?
00:23:07 Harm-Julian: That’s my productivity hack. I’m actually thinking social media might even be an overall net negative for society. I decided two years ago to sign off and haven’t looked back since.
00:23:21 Reto: Yeah, I tend to agree.
00:23:23 Harm-Julian: Thanks, Reto.
00:23:24 Reto Thank you very much.
00:23:26 Scott Hartley: Thanks for joining us and hope you enjoyed today’s episode. For those of you listening, you might also be interested to learn more about Everywhere. We’re a first-check pre-seed fund that does exactly that, invests everywhere. We’re a community of 500 founders and operators, and we’ve invested in over 250 companies around the globe. Find us at our website, everywhere.vc, on LinkedIn, and through our regular founder spotlights on Substack. Be sure to subscribe and we’ll catch you on the next episode.
Read more from Reto Bolliger in Founders Everywhere.