In this transcribed episode of the Used Car Dealer Podcast, Zach talks with Monik Pamecha, co-founder of Toma, about how AI-driven communication is transforming dealership operations—and why speed in lead response is becoming a critical competitive advantage.
Monik shares how Toma entered the automotive space by solving a simple but persistent problem—missed calls and slow responses—and how that expanded into addressing friction across the entire car buying journey. Drawing from his background in engineering and experience working directly inside dealerships, he explains how AI can help dealers respond faster, guide customers more effectively, and operate at a scale that’s difficult to achieve with human teams alone.
The conversation explores where AI is actually delivering efficiency today—from lead handling and service operations to customer engagement—how dealers should think about ROI, and what separates true AI agents from basic automation. It also covers common misconceptions about AI, why it’s not a “magic bullet,” and how underlying dealership processes still determine success. The episode wraps with a forward-looking discussion on how AI will reshape dealership workflows, decision-making, and the competitive landscape in the years ahead.
Zach: Zach here and today's guest is Monik Pamecha, co-founder of Toma, a company focused on helping dealerships unlock efficiency through AI-driven communication and operations. Monik brings a sharp perspective on how new and used car dealers can leverage AI to compete more effectively. We'll dive into what real AI adoption looks like on the ground and how it's changing the way dealers handle leads and drive conversion. Thanks Monik for being in the podcast today.
Monik: Well, thank you so much, Zach, for having me. I'm sad we couldn't meet in person.
Zach: Next time. And for those who maybe haven't heard of Toma or your background, tell us a little bit about yourself, like how you got into the auto industry and ultimately raised from Tier 1 VCs like A16Z and went through Y Combinator.
Monik: Well, my background is I'm an engineer. I've been in tech most of my life. And the way we ended up in automotive is serendipity. So we were just trying to build stuff to solve people's problems.
And, you know, we ended up finding a few customers who really liked our voice AI product about two and a half years ago. And they were as a dealer group in there, you know, like found us at the time, like, I mean, voice AI or AI, for that matter, wasn't that big. It was like GPT 3.5 or something was the big thing.
And they were seeking a solution to answer their phones. And they're like, well, we've had a bunch of VDCs or, you know, folks in the call center try to do it. Not it.
We've had a lot of turnover, help us. And we just took that as a problem statement and try to figure out what we could do, spend like weeks and months in the dealership and came up with a solution. So that's, you know, we took what we had.
We had something that worked with, initially we were focused on healthcare.
Zach: Interesting.
Monik: And we had like this airline that we were running a pilot with and a bank in Australia that we were running. Like all that stuff was going on.
And at the same time, like we're like looking for people to move quickly and really quickly. And we're like, okay, let's double down. And then once we did well for, you know, our customer, they told their friends about it.
And, you know, in a few months we had like 40, 50 customers with like no sales team, nothing. It was just myself and my co-founder.
Zach: That's amazing. And like what specific problems in dealership operations maybe like stood out to you as like most ripe for AI driven solutions?
Monik: So service was one, right? At the time, because franchise dealers obviously had a massive volume of calls on that. But as we went down that path, there's this friction that we saw in the car buying process as well. So, you know, we started focusing on that and trying to improve like the first touch of customers.
Anytime anybody's interested in buying something or, you know, in a lease or whatever, right. They're trying to get questions answered and they want to, they're looking for speed. I want something, give it to me.
Like if you want Amazon, like, you know, you went from like three days to two days to same day to fricking, you know, like in the next three hours, that's where the consumer is going. And we saw that, like, what would it take to make it happen on the dealership side? And, you know, we looked down at, you know, how leads are handled, like what are the friction points in the financing process, whatever, right. So we started attacking these problems on the sales side as well.
So we started with service. So we expanded over to sales and then that opened doors to like not just franchise dealers, right. You have all the dealers, anybody who's selling a car is now, you know, can benefit from something that we have.
Zach: And why do you think dealers in particular are uniquely positioned to benefit from AI right now? Why now, in a sense?
Monik: Yeah, okay. I'd say that everyone is positioned to benefit from AI, like all the way from, you know, whatever job you're doing, right. Even if you're mopping the floor, there's something that AI does, right, that actually benefits you.
But I would say, like, the why now for dealers at least is, I mean, why not? What is, right, what's the alternative, right? Like, let the previous, like, what's the previous experience is like, hey, you respond, like, that's your customer expresses interest and they're just waiting to get an answer, let them wait. No, right? Or if somebody wants to get something, and, you know, there's, there's this, you know, friction point, or I would say obstacle in between, and you can remove it.
Would you not remove it as quickly as possible? Like, there's some financial payment, they're trying to, you know, evaluate the vehicle for trade-in, and they don't know how much it costs, and they're looking for a better explanation of it, or I don't know, in the discovery process, right? Can you help me? Like, I want this, and you, that car's not available. So what, should I just leave the funnel? Or is there some way where you could guide me to something that's very close to what I was looking for that you have right now? So these are the things that AI makes possible infinitely, like, at some scale, right? And like, it's like having 500 sales people, or a thousand salespeople, like, why would you not do that? And these thousands are ones that will do exactly as you want them, you know, as you teach them. So that's what AI enables.
So I think the “why now?” is pretty clear. Consumers want more than ever, and you cannot possibly stretch humans to get there. It's just not possible.
So AI fills the gap.
Zach: Totally. And I would say, though, there's a lot of buzz around AI.
A lot of vendors have AI, you know, attached to what they're doing, you know, from a marketing standpoint. Where do you think dealers are actually seeing the real efficiency gains today with AI?
Monik: Oh, it depends on the dealer. I hear, like, people on podcasts sometimes, and I hear genetic answers, and it, like, pisses me off a little bit.
Maybe I'm guilty of having said that in the past, but now I have understood that it really depends on the nature of your operation, where you would benefit the most with AI. If you have a lot of leads, and you don't have enough people to answer them, you'll benefit with AI over there. If you have a lot of service demand, and you cannot service it, right? And there's something that's choking on your technician side, there's possibly some AI that you could use over there to help you.
It depends what, we call it the longest pole, right, in a problem, like, what is the part that's, like, the most painful, right? Or the most inefficient, and you solve for that. So I would say it depends on the type of dealer you are. You're an import, you're a domestic, you're a luxury, service volume is different, sales lead volume is different, you're tier one, you know, the interaction that they have in terms of how much traffic they send to you, or if you're a used car dealer, right, like your acquisition strategy, your retail location, there is no one thing fits all.
It doesn't exist, but there are, like, opportunities on acquisition, on the actual, like, lead, you know, nurturing side, on the service retention side, on actually outbound, all those things, right. So I would say that's the piece. Yeah, it depends.
Zach: How should dealers think about ROI when investing into AI tools, software products, like, what metrics matter? You know, some dealers might even be thinking on a franchise side about, like, co-op, as it relates to AI efficiency. Curious, you know, your thoughts on that.
Monik: I think they should just measure the dollar value it generates, like, if it's revenue created, like, revenue added, or revenue retained, or, yeah, just, it's not any different from, like, how you measure your current business, you're 20, you know, open the financials, see the cost, like, has it led to reduction in the cost, to what extent, what line item did it remove, what line item did it reduce.
Zach: And let's kind of transition a little into AI and lead handling, and kind of automation versus, like, true AI agents. So what's the difference between traditional automated responses, maybe in CRMs, different platforms, and what you really consider a true AI agent, true kind of AI response?
Monik: I would say that true, this is like, I don't know, spaghetti of, like, terms. But true agent is something that does the work end-to-end.
So if anytime you need any sort of human involvement, that's where the agent's capability ends, right? So you should just measure about how much time you need to put in to actually achieve that same business outcome, from a human standpoint. If it is, like, maybe 5% of, you know, whatever the task is, then that's great.
Zach: And how does an AI agent actually move a lead, let's say from inquiry to qualified appointment, like, what's happening kind of behind the scenes, you know, from, like, a dealer standpoint, as they're thinking about, like, implementing a tool like Toma and managing their leads?
Monik: So let's see, what can the AI agent do a lot, right? It can extract context on the customer.
So let's say if you have this AI agent, like, our AI agent can actually see what you did on the website completely. It has access to your, you know, whatever you were browsing, which pages you hit, what you did until you finally got to the lead. Now the AI can actually see all of this.
It can look you up, right, like, based on the information you gave it, understand who you are, what you're seeking, and then give you the best, you know, response. It's like, usually a lot of times people are spending time explaining to the, you know, the sales representative what they want. What the AI does is it cuts that, you know, I guess, makes it shorter, that distance, you know, it already knows so much.
It's like, it just starts further ahead. That's what the AI agent does. So, you know, in terms of understanding what you're seeking, it has a clearer understanding of that, what type of car, what are your preferences, and then it can surface options accurately, and, you know, till the point where you're sure, you're ready to come in to the store to check it out, or you're ready to buy it, right? Wherever you are in the funnel, it has preferential treatment for you based on where you are, and can get, I mean, imagine a salesman who is, like, really aware, right, can pick up anything that you're saying, like, how many people do you know in your life were like that, right? And sometimes you just end up repeating the same thing again and again.
That ideally, right, like, in the best case scenario does not happen, and our goal is to make that best case scenario, like, every scenario.
Zach: What impact are you seeing on show rates, close rates when dealers start using Toma or, you know, AI kind of driven tool like what you offer?
Monik: So, in terms of, like, appointment set rates, right, we see, like, at least an increase in, like, 5 to 10 percent, you know, over what they were, like, I'm saying 5 to 10 percent if you just start with, like, just add AI without, like, customizing, configuring anything. It is what it is, right? So, 5 to 10 percent over what you were seeing previously with zero modification, because it's just more persistent and a little smarter.
When you customize it or something, you can see lifts of up to 50 percent. Again, it depends on your demographic, on how much effort you put in, but it is possible. And similarly, I mean, it's the same measurement all the way down to every part of the funnel, like, each part of the funnel depending on what changes you make.
And also, right, like, if you're a single price store or do you have negotiation, like, that changes the game completely now because the agent, are you going to let it negotiate? It's up to you, but it will change, you know, the conversation. And if it's like, hey, this is the price, this is it. That piece is easy and maybe more people fall out of the funnel at that point. So, it's a complicated, like, answer to give, but I would say 5 to 10 percent is, like, the base benchmark, like, baseline.
Zach: And are there any common mistakes you see dealers when implementing AI into their workflows at their dealership for the first time, any, like, common mistakes you've observed?
Monik: I don't know if it's dealers making the mistakes or if it's the vendors or, I don't know, miscommunication or it's just a new thing, right? But I wouldn't say a mistake, but it's like a, what's the word for it? You know, it's like an expectation that I don't think is often met with, like, a, you know, I don't know, it never really realizes and materializes, which is, hey, we'll just put AI in and tomorrow it'll be, like, the best of the best. That's not going to happen. Yeah, you're not going to see, like, jumps in all your metrics, you know, because of this.
Because let's say if customers were annoyed about the fact that your prices were not transparent, I mean, AI cannot fix that for you, right? They're just going to talk about this, the AI agent will engage with the customer about the same issue and will tell you that that's the case. So it's not going to change anything if that, if something underlying, you know, is broken. So, yeah, it's not a magic bullet.
Zach: Yeah. And as you look ahead and you start to think about AI reshaping dealership, maybe even staffing models over the next three to five years, like, what do you see? What do you, what do you predict in terms of, like, AI developments with dealer software the next three to five years?
Monik: I think what will happen is that the experience should improve for the customer. It will get extremely competitive.
So people will be able to engage with multiple dealers as quickly as possible and get, like, all the information they want because they'll have their own agents. So, yeah, dealer software will mostly become invisible, I would say. That's what's going to happen.
Like, it's less of software and more, like, stuff that gets done and you'll just be, like, dealing with, like, you'll be configuring, like, you know, you'll be diagnosing why, you know, like, you look at the conversation, you'll have the, you'll have, you'll be making decisions, like, you're like, oh, so we lost 60% of our deals because of price. So should we do something here? Like, you, these, you know, alerts or other decision criterias will bubble up and you'll basically be playing a video game, right? It'll reduce running any business to a video game where, you know, they'll distill the decisions that you have to make as to why it's working or not and you'll just pick something. And then your combination of decisions is your video game, you know, is your dealership.
And then you see how it performs and you measure the score. So it's going to become a game. I mean, it already is, except that it's difficult to see these metrics that way, but, like, these AI agents will reduce it down to that.
Zach: That's a really interesting take. And a lot of people talk about AI replacing potentially a lot roles versus augmenting existing teams. Curious, like, your perspective on that.
Monik: Both will happen, right? Like, I'm sure there are people who still write books with hand, but there's the press, right? But is it, you know, like, the roles will get, certain roles will become redundant, certain roles will become more important. Some roles will change. All the three things will happen at the same time.
I wish I could predict the future.
Zach: Yeah. You know, for dealers, let's say they're skeptical about getting started with AI, like, what's the first step? What should they just consider just to cut the string and jump into AI adoption?
Monik: What is it stopping them?
Zach: Yeah. Well, like, for instance, some dealers are concerned, I don't want to, you know, implement this AI tool because it doesn't integrate with X, Y, or Z system yet. You know, there's, like, hesitancy to adopt the technology.
I'm scared it's going to say something bad to a customer, like, maybe promise, you know, 20 grand out the door on a Bentley Continental. Like, curious, kind of your perspective on that.
Monik: I feel for them, because I myself buy tools, right, for our company.
I am also scared of, like, what, you know, the hits our metrics will take for, you know, because of the fault of a product. But at this point, I feel like the margin for error is, like, as a business, as if you're operating, like, it's, you know, everything is competitive, right, especially if you're a dealer. Like, it's, like, oh, at what point is the risk justified? That is the question.
Like, everything has risk. Even walking on a street has risk, right? You get hit by a car or a meteorite. I don't know, right? But the question is, in your head, you're doing some math on, like, what is the upside? What is the downside? Everybody calculates this differently.
But I would say, overall, at this point, the upside for using AI is just so much higher. And the downside is reducing over time. So, you know, what AI could do two years ago and what, you know, the risks of, like, oh, is it going to, like, completely tell someone how to, like, use soap to make something, you know, that can explode? That's not true anymore, right? But that's not to say that there are different ways in which this is coming up, right? So the risks remain.
They will never be zero, but they'll never be, you know, 100% either. So it's a trade-off. And the odds are, like, forever increasing in favor of AI.
Zach: Well said. So last part of the podcast, three kind of rapid-fire questions. So I'm going to start with the first one.
One dealership process you'd automate tomorrow, if you could?
Monik: Oh, I think the leasing process, like, the entire, like, all the steps in it, not because... I think it's the easiest and the simplest to automate. Like, you could hands-off do that.
Zach: Yeah. Leasing calculator. Totally.
Monik: Or just, like, the transaction, actually.
Just taking a car off a lease, like, you could do it in, like, six clicks. It's, like, possible.
Zach: Second question. Biggest misconception dealers have about AI?
Monik: That AI actually has a brain of its own.
Zach: In one sentence, what separates high-performing dealers in the next five years?
Monik: I think it's discipline. It's, like, giving up short-term gain for long-term gain.
Like, you know, understanding that, like, very few, like, operators, I think, you know, internalize this. And, you know, sometimes the operators do, but then their employees don't. So I think whenever we've seen a culture of that, like, we've seen tremendous results.
Zach: Very well said. So anything else for the guests? Like, how could they find out more about Toma? Sorry, I meant the audience. How could anyone find out about Toma? Any conferences upcoming for you guys? Any shout-outs?
Monik: Yeah, I mean, they just come to Toma.com or, you know, email me.
I mean, reach out to me on LinkedIn, anywhere, right? My email is monik@toma.com. Yeah, always there to respond, help customers. You know, I got a TMV salesperson license myself in California. I've been in the store selling for some of our dealers.
I was like, you know, I need to feel the pain myself and get an idea of what's going on. And that's what I've been doing. And that's been helping me improve the product, like, dramatically.
Zach: That's amazing. Like, what gave you that idea to do something like that? Because most founders in auto, I can tell you aren't doing that. Like, that's really revolutionary.
Monik: So because somebody at a store challenged me, I was like, why don't you do this way? And he was like, what do you know? You've never sold cars. I was like, how difficult can it be? Right. And then I am now like down on the floor selling it, trying to figure it out.
I was like, I need to understand why is this lead not, like, why do you think this is a bad lead? Or why is this difficult or not? Whatever it is, right? I want to know for myself. And, you know, I've done my share of selling, but I want to figure out what are the difficulties and intricacies in this. And honestly, I just, it's fun.
Like, I've made like some good friends. We just, yeah. It's more fun than I thought it would have been.
It's also annoying. Like, more annoying than I actually thought it was as well, by the way. So I feel the pain that folks have.
I, the frustration and, you know, I, I'm starting to get it more than I ever did.
Zach: Yeah. I remember I was in college.
I was going to Emory selling cars. So I had all this context switching where, you know, I might be doing business classes during the day, going to the dealership. And I just, I learned tremendously there.
And that's kind of what planted the seed for my product. And I just loved how, when you started Tomo, like you were in the dealerships, even at this point after raising, you know, VC and like really off to the races, like you're still going back. So that's like just super impressive.
Says a lot about you as a founder.
Monik: Well, thank you. Well, I, I just like to learn.
So I'm putting my head down, head down and learning, you know, how business is done and, you know, hopefully refuse like the knowledge from all different sides and, you know, the customer, you know, yeah. Benefits from this.
Zach: Awesome. Well, pleasure having you on the podcast today. Thanks so much for joining.
Monik: Awesome. Thank you so much, Zach.