Perseverance: From running out of money to an IPO - StubHub comes back strong

Anna Vod · May 2, 2024 · Short URL:

In the post-Covid drive for live events, ticket platforms are jumping at the opportune market time

Ticket resale marketplace StubHub is set to raise new funds this summer against the backdrop of a looming antitrust lawsuit for Ticketmaster and its NYSE-listed parent Live Nation. This potential new beginning as a publicly-traded company after a rollercoaster ride beginning that once left the company with only two months left of cash. 

It's a story of perseverance for sure.

StubHub was founded in 2000, acquired by eBay in 2007 for $310 million and re-acquired by its co-founder Eric Baker in 2020 for $4 billion. StubHub then merged with Baker’s international ticketing sales platform viagogo. At its present state, the online ticket marketplace is eyeing a valuation of no less than $16.5 billion at its initial public offering, according to CNBC. 

Stories like these get entrepreneurs excited about the prospects of starting a company and going public. But it's the backstory of lessons that are worth remembering. Back in 2012, StubHub's other co-founder Jeff Flur shared his lessons running the startup. Watch and read: StubHub's Jeff Fluhr's lessons learned.

Onward to an IPO

StubHub has been holding discussions with JPMorgan and Goldman Sachs on its going-public deal; as of late April, its prospectus has not been made publicly available through the SEC.

StubHub positions itself as a fan-to-fan ticket resale middleman. It provides sellers with a platform to sell their tickets to evens spanning across concerts, sports, theater plays, and comedy shows; and for buyers to pick and choose from various price options. Unfortunately, negotiation is not in the picture, so it doesn’t work exactly like, say, eBay. But it does have tools like the price alert, which allows buyers to wait for cheaper options.

The platform also validates its tickets, ensuring buyers receive their tickets on time and sellers get prompt payment. In case of any issues, StubHub commits to resolving them with equal or superior tickets or a refund. Moreover, if an event is canceled without rescheduling, buyers have the choice of a 120% credit or a full refund.

Reportedly, StubHub’s rival, secondary ticket marketplace SeatGeek has also picked up its going-public plans, now targeting an IPO. Last year, the company pursued a SPAC merger that would value the company at $1.35 billion – but mutually terminated the talks with RedBall Acquisition Corp. amid a strained market environment. SeatGeek recently struck a lucrative MLB ticket sales deal.

Earlier in April, StubHub rival Ticketmaster came under fire from the Department of Justice; regulators are preparing an anti-monopoly lawsuit said to come as early as in May. The platform has faced investigations from the DOJ since late 2022 when it crashed ahead of Taylor Swift’s Eras Tour due to heavy website traffic. In recent weeks following news of the coming antitrust lawsuit, Ticketmaster parent Live Nation lost nearly 15% of its market value.


Image: StubHub

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