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Second most popular Chinese group buying site gets a sizable infusion of capital for booming market
Chinese group buying site Lashou announced Monday that it has closed a $110 million Series C funding round led by Mileston Capital, with participation from Richemont’s affiliates Reinet Fund SCA FIS, Remgro Limited, and previous investors GSR Ventures, Norwest Venture Partners and Tenaya Capital.
Added to two previous funding rounds, the Series C brings Lashou’s total venture capital raised to $166 million, more than any other group buying company in China. That’s important because Chicago-based Groupon has ignited a global investor and consumer frenzy over daily deals and group buying. Considering that Lashou was only founded a year ago, in March 2010, the latest large funding round speaks volumes to the state of the market.
"The competition around the players will be intense," said Liping Qiu, a managing director and co-founder of Milestone Capital. "It will be even more fierce in the coming months.”
In China, Lashou only lags behind Taobao Juhuasuan, part of Alibaba Group, in the race for unique site visitors. In January, Taobao saw 76,000 uniques versus Lashou’s 45,000, according to a report published by technology research and consulting firm iResearch Consulting Group. Following Lashou are Meituan, tuan.qq.com (by Tencent Holdings Ltd.) and Groupon.cn, a literal carbon-copy clone that has no official ties to its namesake.
If you’re surprised to not see an official Groupon on the list, that’s because it’s tucked nicely behind the name “Tencent Holdings.” The two entered a joint venture agreement in mid-February, with each reportedly taking a 50 percent stake.
Outside of China, Groupon most recently announced launches in South Korea, United Arab Emirates and Australia, as well as in two U.S. cities, San Angelo, Texas and Columbia, Mo. Last year may have been the year the spark caught, but in 2011 we’ll see how far and wide the group buying fire can rage.
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