One month later, startup takes in another round to beef up and expand its local deals platform
Groupon,
which raised $135 million from DST at a $1.35 billion valuation a couple weeks ago isn't the only startup in the local buying space raising cash. This morning,
LivingSocial, a startup out of Washington D.C.- announced it closed a $14 million Series C round led by Lightspeed Venture Partners. U.S. Venture Partners, Grotech Ventures and Steve Case's Revolution also participated in the round.
What's interesting is that this round comes right on the heels of a $25 million Series B
announcement the company made last month. The startup, which offers daily "deals" for local shops in specific cities, said its services are really taking off and it wants to expand into additional markets.
"We’ve known and admired the LivingSocial team for a long time, and I have bought many of their terrific local offers. They’ve done an excellent job of growing their user base through smart media buying and excellent knowledge of social channels and virality," commented Jeremy Liew, managing director of Lightspeed Venture Partners.
In case you haven't experienced the local daily deals crazy yet, it's really worth a checking out. In LivingSocial's case, you'd head to its site, see what the deal of the day is, pre-buy it, and then take advantage of the social features. For example, trying to get your friends to purchase the same deal, and YOU can get three people to purchase the deal using a special link, YOU end up getting the deal for free.
Although Groupon continues to dominate the market, LivingSocial is definitely the number two player in this space. The startup has about 85 million members on its social network and said over a million using its group deals feature. It said it saved users an average of $32 each in March, and tens of millions of dollars since 2009.
The company also announced some new markets it's now available in as of today, which include Portland, Orange County, Charlotte and Philadelphia, which brings it live to 18 cities across the country. Part of the capital will be used to expand to dozens of other markets throughout this year.
It's also launching a 'hyperlocal deals' feature which targets specific areas within a city in hopes to have its users explore new things and offer more opportunity for merchants.
In the end, how is LivingSocial going to make money from this? Well, the startup makes money by taking a cut of these transactions from whichever retailer they've partnered with for the day.
“We’re constantly receiving requests from our users to expand and launch in their markets, and this recent funding round will allow us to do just that,” said Tim O’Shaughnessy, CEO and co-founder of LivingSocial.
Steven Loeb
