CEO Andrew Warmath started Carmigo while working as CFO of a car dealer group with locations in Mississippi, Alabama and Tennessee. As the pandemic hit full stride in the summer of 2020, available used cars were drying up, and prices were skyrocketing. When he listened in on an earnings call for consumer-focused Carvana, he saw an opportunity that could solve inventory challenges for dealers by getting consumers to put their cars up online for bid.

So, Tupelo-based Carmigo launched as an app that makes it easy for consumers to offer their cars to dealers, thus allowing the dealers to replenish their used car inventory. The software that Carmigo developed connected consumers to dealers, who would then make offers on the vehicle. While it’s technically an auction, and Carmigo initially used that word in their marketing, Warmath says it made consumers uneasy. So now Carmigo “presents multiple offers to the seller,” who can then choose the best price or make their selection on some other criteria.

As Carmigo grew, selling 3,000 cars in their second year, they also improved the software, adding an artificial intelligence component that makes it possible for consumers to sell their vehicle without having an inspector visit to look at it. Instead, the app scans their VIN and guides them in taking the exact photos they need to assess any damage and communicate that to buyers.

In 2022, Carmirgo closed its Series A raise of $7 million in the middle of the year. They also began recognizing that the pandemic-era used car sales bubble was bursting. With a solid financial runway, they’ve focused on their unit economics, finding ways to increase revenues and decrease customer acquisition costs.

For 2023, Warmath says the company focuses more on used cars from fleet leases, bank repossessions and dealers looking to turn over their inventory. While Carmigo still markets to consumers, the truth is that a given individual might only sell a car once every few years—if that often—while institutional buyers turn their inventory over much more often. They’re more reliable for sales and purchases, so the Carmigo technology is valuable in that marketplace.

While building the business, raising money and working to improve their margins, Warmath says that the state of Mississippi has been a fantastic place to run a startup.

“I’m not originally from Mississippi; I moved here in 2012,” he said. “So I think I’ve got a pretty unique perspective. And I think we have a competitive advantage because we’re so unassuming. There are so many people around here who want to see you win and want to see you succeed. I don’t think I’ll ever leave.”

For example, he points to Innovate Mississippi’s Accelerate 2022 conference, where he pitched Carmigo. He was introduced to the CEO of Idea Village in New Orleans at the show and encouraged to apply to the accelerator; Carmigo is now in their 2023 cohort.

“Idea Village has a network that you would not believe—it’s the Benson family, the Barksdale family, and many more,” he said. “You know, they’re giving their time and resources to help see these future entrepreneurs succeed.”