This question came up in the conference call. I found the answer to be extremely positive and down right exciting.
Terrific. And if I could squeeze one last in. Certainly, on the EBITDA compression, you provided some color in your prepared remarks on ramp-up in auto and hiring in tech. But if you think of like first for 12 months from now, what do you think may drive kind of upside? I mean, certainly, you have to invest in auto and you’re going to have hire tech folks. But is there any levers you have in place that can drive some upside in EBITDA margins?
Yes, absolutely. And I would think that, if you think about the auto business itself, it’s going to go through a cycle much like the personal loan business did, where in the early days you’re ramping, you’re developing your sort of acquisition programs. They’re not quite at scale. Your operations are not finally tuned.
And so, in the early days of our personal loans, if you look back to our corporate history, we knew we had a lower level of profitability. And as that business scaled, it started accreting pretty directly to the bottom line. And I – we believe that auto is going to go through a similar cycle, maybe a more accelerated one, because we know the playbook now.
But as it is today, where we’re starting to achieve meaningful volume, our CACs are not as efficient as they are in personal lending, our operations unit costs are not as efficient as they are in personal lending, but they will get there. And as the models get better, the conversion funnel improves.
All of the things that happened to our personal loan business, we anticipate will happen on the auto business. And so whereas in 2022, it will be, maybe a bit sort of dilutive to our contribution margins at scale and at maturity, we think that it will have the same sort of profitability profile as our core business today.
So that’s just something – I think we’re sort of like incubating new businesses as we go. Dave sort of alluded to a pace of, you don’t want to read 6 to 12 months of new business, and it will go through an investment cycle.
But as we get more and more in our portfolio, that have matured and are sort of now ‘cash cows.’ I think the natural profitability of the overall model will just, kind of, trend to its equilibrium direction, which we believe is higher than where it is today.