Group Commerce Raises More Funding to Ramp Up Daily Deals Platform for Publishers
New York-based Group Commerce, which came out of stealth only two months ago, has raised an additional $10 million in funding to help quickly ramp up a platform that enables publishers and media partners to get into the daily deals market.
The company, founded by former Google and DoubleClick executives David Rosenblatt, Jonty Kelt, and Andrew Glenn, has now raised a total of $18.5 million.
Group Commerce’s CEO Kelt confirmed the ink was still drying on the check. “We only recently came out of stealth mode. The topline is that things are going really well. We wanted to accelerate what we were doing.”
The round was funded by the company’s current investors: Spark Capital, Carmel Ventures, Lerer Media Ventures, and Bob Pittman, the founder of MTV Networks and now chairman of media and entertainment platforms at Clear Channel. This publication also reported on the funding.
Kelt said there was a lot of investor interest and they could have raised more but they decided to stick with insiders.
Unlike Groupon and the hundreds of clones sprouting up all around it, Group Commerce is building a white-label platform that can be used by publishers and media companies that have traditionally been in the local commerce business, but have been left out of the Groupon phenomenon. Some of its early customers include: DailyCandy, Meredith Corporation, Thrillist and the New York Times.
Seattle-based Tippr is a direct competitor. Having been in the market for longer, Tippr has about 70 partners, including Fox and NBC affiliates in some local markets. Tippr has raised about $9 million, and has 120 employees.
Kelt said the money will go toward supporting its current customer base as well as additional media partners in the pipeline. Two months ago, they had 35 employees. Today, they have 50 with sales members in six cities; they want to be at 100 employees by the end of the year and in 15 markets.
Group Commerce gives its partners the choice of using its own sales force to sell the daily deals, or relying on Group Commerce’s sales force. Additionally, it tries to match relevant deals to the readers of the different publications. “As a general comment, I’d say we are getting better at it, and therefore our partners want us to be more aggressive.”
The funding market for daily deals is hot right now. Gilt Groupe, which also has a daily deals business called Gilt City, just raised $138 million, and Groupon is eager to file for an initial public offering. Last month, LivingSocial raised $400 million.