$5m funding for Jump On It
Online group buying company, Living Social, has invested five million dollars into Australian daily deal website Jump On It .
The announcement:
Leading Australian daily deal website Jump On It (www.JumpOnIt.com) today announced it has secured nearly $5 million in funding from the fastest growing online group buying company in the US: LivingSocial.
LivingSocial (www.LivingSocial.com) operates in the US, Canada, Ireland and the UK, and has more than 10 million subscribers in more than 100 cities worldwide. It also had the largest online audience in its segment in October 2010, according to Compete.com . While it has yet to launch in Australia, LivingSocial has been building its Australian presence here since January, acquiring a massive local email subscriber following looking for daily deals like those offered by Jump On it.
LivingSocial CEO Tim O’Shaughnessy says, “Since the beginning LivingSocial has regarded Australia as a strong potential market. Our decision to partner with Jump On It will help us capitalise on the presence we have already achieved there. We chose Jump On It because it has clearly the best team in the local market and the largest Facebook fan page membership in Australia. LivingSocial’s vision for the local market and the way we do business are very much aligned with Jump on It.”
Since its launch in May this year, Jump On It has become arguably Australia’s leading group buying website with an Australia-wide presence and more than 550,000 fans on its Facebook pages. Together with LivingSocial, Jump On It will now reach more than 1.2 million Australians via email and Facebook every day.
Jump On It CEO Colin Fabig says, “Offers to invest in Jump On It were made by the leading US companies and venture funds as well as many local media companies. After meeting all interested parties, we decided to partner with LivingSocial because we have a close cultural fit with their professional management style and they had the vision to have already acquired an extensive database of Australian subscribers now ready to jump on our great deals on spas, restaurants and activities in their city.”
With the new partnership, the Jump On It executive team – CEO Colin Fabig, Sales Director James Gilbert and COO Adam Rigby – will stay on and continue to grow the Jump On It brand. They will also manage the launch, operation and growth of the LivingSocial website in Australia, bringing a vibrant new offering into the local market.
“We are very excited about the imminent launch of LivingSocial here,” says Fabig. “We expect to lead the online group buying sector in Australia by offering customers many more deals across these two websites and by giving local businesses a one-stop shop to get hundreds of new customers at no risk or cash outlay.”
Source: Jump On It press release
So, who is next? Groupon?
There’ll be a few more mergers and takeovers in this market, even the smaller players are profitable at the moment.
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Whilst an easy way to move excess capacity/inventory, one has to imagine that retailers will eventually realise that discounting at this scale will not grow their client base but just see thmn overrun them with tyre kickers and tight arses.
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These sites are going to kill local classifieds newspapers a bit like Seek and Realestate killed mainstream classifieds – they offer guarranteed customers at no cash outlay – why should an SME gamble on paying for hit-or-miss advertising anymore?
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good quick money to be made for fast movers in this space.
so much hype around group buying – which means great exit multiples from ill-informed investors.
no evidence this type of business is sustainable but right now there’s no better place to be if you want a nice fat exit. bet your house News and FFX are looking at these relatively embryonic local startup groupon clones.
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