People
Figures converted from EUR at historical FX rates — see data/company.json.fx_rates. Ratios, margins, and multiples are unitless and unchanged.
The People Running This Company
Grade: B. Auto1 is a founder-led, founder-owned business with extraordinary skin in the game — Christian Bertermann (CEO) and Hakan Koç (Supervisory Board Chair) together own roughly 21.5% of the company, worth about $1.2 billion at the current quote, against modest cash salaries and disciplined share-based pay. The flip side is that the same two co-founders sit on both sides of the oversight relationship: the CEO is supervised by a board his co-founder chairs, and CFO turnover (two CFOs in eighteen months) has just removed the most experienced public-company finance voice. ISS rates the audit and shareholder-rights pillars at low risk but flags compensation at 8/10 — the one structural weakness we agree with.
1. The People Running This Company
The slate is unusually thin for a $5.8B company — a two-member Management Board and a five-member Supervisory Board. That works when the founder-CEO is genuinely operating the business (which Bertermann is), but it leaves Wallentin as the only public-facing executive other than the CEO. His credibility on the next four earnings calls is the single biggest near-term people risk.
The Koç question. Hakan Koç co-founded Auto1, was Co-CEO until 2020, and in June 2024 was elected Chairman of the Supervisory Board. The board that hires, pays, and (in theory) fires Christian Bertermann is now chaired by Christian Bertermann's co-founder. The German two-tier structure is supposed to put a hard wall between management and oversight; here the wall is two co-founders who built the company together. This is not a fatal flaw — both hold ~$1.2B of stock and want the same thing as outside shareholders — but it is the reason board independence is "real" rather than "strong."
2. What They Get Paid
The Remuneration Report 2024 is gated behind the JavaScript-rendered IR site, so granular pay-mix is not retrievable. The strongest disclosed pay datapoint is from the company's FY2022 filing, surfaced by Yahoo Finance: Bertermann's cash compensation that year was about $544,000. Against a $6.5B-revenue business and a personal stake worth ~$700M, that is a strikingly low cash salary — closer to a startup-founder posture than a typical European CEO package.
CEO Cash Pay FY2022 ($k)
CEO Equity Stake ($M)
Stake ÷ Cash Salary
Across five fiscal years since the IPO, share-based compensation has averaged about $17M per year — under 0.3% of revenue. By post-IPO European tech standards, this is restrained. Headline tech listings of similar vintage routinely run SBC at 3-8% of revenue. Auto1 grants stock sparingly, which is consistent with founders who already own enormous economic interests and have no need to dilute themselves further.
Verdict on pay: the disclosed cash component is modest; the equity-comp drain on shareholders is small; and the ISS Compensation pillar score of 8/10 (high concern) is therefore the one piece of external scoring we partially disagree with — likely driven by limited disclosure of LTI targets and EU-style abstention items rather than excess. The headline numbers look shareholder-friendly.
3. Are They Aligned?
This is the strongest section of the case. Founders, anchor investor, and an activist hedge fund all hold meaningful stakes, dilution is contained, and the founders have not used the IPO as an exit.
Ownership and control
Founder insiders hold 21.5% combined. SoftBank Vision Fund 1 still holds 14.8% — material, but down from the ~20% it bought at the 2018 round and well below the level at which it could force a sale. Two activist-style US funds (Cadian, Sachem Head) together hold ~12%, which is constructive: they wouldn't tolerate value destruction quietly, and Cadian's 9.87% is the kind of position that gets management's attention without dictating strategy.
Insider buying and selling
The directors'-dealings page on Auto1's IR site is JavaScript-rendered and the structured transaction history was not retrievable. The behavioral signal that is available is unambiguous: at IPO (February 2021) the stock priced at about $46; today it trades at $26.12. The IPO drawdown is roughly 40%. Across that period, Bertermann's disclosed stake has held around the 12% line and Koç's around 9% — the founders have not used the post-IPO window to monetize at scale. As a German foreign private issuer there is no SEC Form 4 footprint, so the absence of disclosed selling is not as definitive as in a US filer, but voting-rights notifications under WpHG §§33-39 would have surfaced any material reduction, and none has.
Dilution
Share count rose 21% at the IPO (2020→2021) and has crept up roughly 1% per year since. That is genuinely modest — none of the secondary placements or convertible-note conversions that typically follow a European IPO. Combined with the SBC discipline above, dilution is a non-issue.
Related-party behavior
The pre-IPO capital structure involved meaningful related-party complexity — convertible notes from Farallon, Baupost and Sequoia in 2020, plus the SoftBank anchor — but those are now resolved. The post-IPO disclosures we can read do not flag any material RPT. ISS's Audit pillar score of 2 (low risk) is consistent with that read. We classify related-party concerns as minor.
Capital allocation
Cumulative free cash flow since the IPO is roughly –$1.9B, financed by IPO proceeds and ongoing financing activity. FY2024 was the first net-income-positive year ($22M) and FY2025 stepped up to $92M — but operating cash flow turned more negative in FY2025 (–$544M) as inventory and receivables grew with retail. There have been no buybacks (treasury stock is only 0.21% of shares), no dividends, and no large acquisitions. Capital allocation is "fund the build" — defensible while the unit economics scale, but the runway question is real and Stan's verdict and Forensic's read should be checked against it.
Skin-in-the-game score
Skin-in-the-Game (1-10)
Founders hold roughly $1.2B in Auto1 stock between them. The CEO's disclosed cash pay ($544k in FY2022) is a rounding error against his $718M stake. Dilution since IPO is ~7%. The alignment math is as clean as it gets for a public European tech business — the score loses one point only because we cannot read the LTI structure of the Remuneration Report and because the founder/chairman setup means the people designing the pay are not at full arm's length.
4. Board Quality
The Audit and Shareholder Rights pillars are well-rated — one-tier free-float dominance, no dual-class shares, no anti-takeover defenses worth fighting. The Board pillar is mid (5/10) because of the founder/chairman setup and the small size of the supervisory body (5 members for a multinational of 6,300 staff is light). The voluntary ESG Committee at Supervisory Board level exceeds the German Corporate Governance Code requirement — a positive signal of intent.
Expertise that's actually present: e-commerce ops (Frese), auto finance (Santelmann), VC/fintech (Miele), broad finance (Pietzner). Missing: a senior independent automotive-industry operator (someone who has actually run a multi-country used-car retail business), and a deeper bench on technology and data — both are operational risks for a company whose moat depends on inspection, logistics and pricing engineering at scale. The Audit Committee gained a second voice when Miele joined in 2024, which addresses the previous single-point-of-failure on financial oversight.
Board independence verdict: real, not strong. Three of five supervisors are formally independent and bring relevant skills, but the chair is a co-founder with a $524M economic stake aligned with the CEO. This board will not rubber-stamp a value-destroying acquisition (the activist holders would not allow it), but it is also not the board you turn to if you need an independent supervisory voice to push back on the founder's strategic instincts.
5. The Verdict
Governance Grade
Skin in the Game (1-10)
Founder Stake (%)
ISS QualityScore (1=best, 10=worst)
Grade: B.
What pulls the grade up: Founder skin-in-the-game on this scale is rare among European listings. Bertermann and Koç hold a combined $1.2B in Auto1 stock and have not used the post-IPO window to sell — even through a 40% drawdown from the IPO price. Cash compensation is modest, share-based compensation is under 0.3% of revenue, and dilution is ~1% per year. Two US activist holders (Cadian, Sachem Head) sit at the table, which keeps strategic discipline honest. ISS rates audit and shareholder rights at the favourable end of the scale.
What pulls the grade down: The co-founder Chairman of the Supervisory Board supervises his co-founder CEO. That is a structural alignment win but an independence loss, and it means investors are betting on the founders' integrity, not on a hard governance check. The Management Board has just gone through CFO turnover (Boser → Wallentin) at exactly the point where retail unit economics need their most credible public-company finance voice. ISS flags the Compensation pillar at 8/10 — we partially disagree, but the underlying point that LTI structure is under-disclosed is fair. Cash burn since IPO has been heavy (-$1.9B cumulative FCF) and the board has not yet had to prove it would force a strategic pivot if the retail build did not work.
What would most likely upgrade us to A-: A successful first year for Wallentin combined with FY2026 FCF turning positive while founder stakes remain intact — proof that the founder-led model delivers without further calls on capital.
What would most likely downgrade us to C: Founder selling pressure (a voting-rights notification taking Bertermann or Koç below 10%), a strategic acquisition that benefits SoftBank's exit rather than minority holders, or a Remuneration Report 2025 disclosure showing LTI mechanics that disconnect pay from per-share value creation.