In August 2024, we analysed how Carvana pulled off a remarkable turnaround from the brink of collapse. Carvana's Impressive Comeback: Defying Market Expectations and Achieving Remarkable Recovery - Cambria Private Capital. Back then, Carvana had just posted its first profits and stunned observers with triple-digit growth in units sold and a swing to positive earnings. That “Impressive Comeback” saw Carvana defy market expectations, even as UK rival Cazoo floundered in the same period. Fast-forward to April 2025, and Carvana’s story has grown more astonishing. The once-misunderstood online used-car retailer has cemented a 100-fold surge in market value from its lows, prompting reflection on how it got here and what lessons founders and investors can draw from its journey.

A Historic Comeback

By 2025, Carvana’s turnaround has been hailed as “the single greatest comeback in public markets over the last decade”. The numbers are eye-opening. In 2022, Carvana’s stock collapsed by 99%, sinking to a mere $3–4 per share and a $400M market cap amid bankruptcy fears. Today, its share price has rebounded above $200 (still below its 2021 peak near $370) and its market cap exceeds $35–40 B. That’s roughly a 100x rise from the trough – an “unheard of” recovery. Investors who “hung on” through the depths have been rewarded richly. The share price trajectory illustrates this wild ride, from pandemic-era highs to near-zero and back to growth:

Carvana’s share price (USD) from 2021 to 2025 shows a meteoric rise and fall. Shares peaked above $350 in mid-2021, plunged below $5 by late 2022, and rebounded above $200 by April 2025.

Such a reversal did not happen by luck. Carvana’s structural strategy and a series of bold decisions laid the groundwork for this resurgence. In our 2024 analysis, we noted Carvana’s focus on customer experience, operational efficiency, and financial restructuring as key drivers of its recovery. Those moves – from renegotiating $1.2B in debt in mid-2023 to optimising logistics and cutting costs – restored stability and investor confidence. By Q4 2024, Carvana was reporting record results (e.g. $429M Adjusted EBITDA on $3.7B revenue in Q3) and even declaring itself “the fastest-growing and most profitable automotive retailer”. In short, the company navigated from near-death to market darling by executing a clear vision when few believed in it.

The Emotional and Strategic Journey of Leadership

What was it like inside Carvana during this roller coaster? In an April 2025 20vc podcast interview, CEO Ernest (“Ernie”) Garcia III opened up to Harry Stebbings about the emotional and strategic journey behind Carvana’s comeback. His candid insights offer valuable lessons for founders and investors alike:

• Enduring the 99% Crash: Garcia recounts the darkest days in 2022 when “our stock went down 99%. Our bonds were trading at like 40 cents on the dollar”. This near-death experience tested every ounce of the team’s resolve. Yet, rather than panic, Carvana’s leadership learned that even in a public meltdown, there are more solutions than it first appears. Garcia reflected that such crises taught him that perceived near-death moments often have more paths to survival than outsiders assume. It’s a powerful reminder for founders: don’t quit when the world thinks you’re finished. As long as you keep solving problems and rallying your team, a comeback may still be on the table.
• Conviction in Unconventional Strategy: From the start, Carvana chose an unorthodox path that many investors questioned. Garcia told 20vc that early VCS wanted Carvana to “fit the patterns” – e.g. act as a light marketplace on top of existing dealerships – but he deliberately ignored that advice. “We didn’t fit the patterns, and we didn’t have the relationships [for investors to have conviction].” Instead, he doubled down on vertical integration: buying cars outright, reconditioning them in-house, building those signature vending-machine towers, and creating a full-stack online experience. This stubborn self-belief, which Garcia humorously equates to “being an egomaniac”, was critical to Carvana’s success. The lesson for entrepreneurs is to stick to your vision if you genuinely believe it creates value, even if the funding environment doesn’t get it. As Garcia says, “You need to take risks to do something meaningful. And I think risk is less risky than most people believe.” Bold bets can pay off when executed well.
• Leading with Resilience and Groundedness: Despite Carvana’s massive scale today (selling ~400,000 cars a year with a logistics network “that rivals Amazon”), Garcia stresses the importance of staying close to the frontlines. “The pressure of scale pushes everyone up the pyramid… If you want to make the biggest difference, get in the game, stay close to the ground,” he noted, emphasising that great leaders remain hands-on with operations and customer needs. This “fighting abstraction” mindset (to use his phrasing) kept Carvana agile even as it grew. He also spoke about personal growth – observing that external success can change how others see you, yet “you haven’t changed in your own [eyes].” This grounded perspective helped him navigate hype and criticism without losing focus.
• Embracing the Harsh Reality of Public Markets: Garcia had bracing advice for founders contemplating an IPO. “Being public, it’s just cold, it’s ruthless, it’s just results,” he told Harry Stebbings bluntly.

Carvana’s journey from near collapse to a market leader offers profound insights for founders and investors alike. Ernie Garcia III’s reflections on the 20vc podcast underscore the importance of resilience, conviction, and adaptability in the face of adversity. As Carvana continues to navigate the complexities of the automotive retail sector, its story serves as a testament to the power of innovative thinking and steadfast leadership. For UK entrepreneurs and investors, Carvana’s experience highlights the potential of embracing bold strategies and maintaining a clear vision, even when faced with scepticism. As the automotive industry evolves, the lessons from Carvana’s resurgence can inform approaches to scaling businesses and responding to market challenges.

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