Exclusive: LivingSocial Makes Giant Push Into Asia With Acquisition of South Korea’s Ticket Monster
LivingSocial has acquired Ticket Monster, one of the largest daily deals sites in South Korea. Terms of the deal were not disclosed.
The move is a major one for LivingSocial in many ways, establishing for the Washington, D.C., start-up a major beachhead in a key Asian country.
It is also the biggest of the nine acquisitions LivingSocial has made over the past year.
Ticket Monster’s name might well refer to the scary growth it has been experiencing. In the past year, Ticket Monster (known popularly in South Korea as TMon) has grown rapidly from virtually no revenues in May 2010, when it was founded, to $24 million last month.
It has more than 600 employees and offers roughly 60 deals a day to South Koreans. The company, which purchased Malaysia’s Integrated Methods in June, had also been preparing for an initial public offering.
For LivingSocial, which is the second-largest deals provider after Groupon, TMon will provide a critical home base in Asia, which has been historically difficult to enter for U.S.-based companies.
As Groupon has demonstrated, it can be both challenging and costly. LivingSocial is expected to follow Groupon and file for an IPO. Groupon runs its own division in South Korea.
So far, LivingSocial operates in a handful of Asian countries, including the Philippines, Thailand and Indonesia, through acquisitions of Ensogo and DealKeren earlier this year. Once the deal is approved by South Korean regulators, LivingSocial will operate in 23 countries in total.
The similarities between TMon and LivingSocial are easy to spot.
In addition to daily deals, TMon has also rolled out specific niches targeting families, events and travel, as well as offering instant deals, which can be purchased and used in the same day. It also sells a variety of products, from books to handbags to other fashion goods, through flash sales.
Its general e-commerce capabilities may have also appealed to Amazon, one of LivingSocial’s major investors.
“They have been studying their favorite U.S.-based company for a bit now,” LivingSocial CEO Tim O’Shaughnessy joked.
More seriously, he added that LivingSocial has been having conversations with TMon for awhile.
“We like the team and how fast they’ve been able to innovate and grow beyond one business line into multiple business lines. They’ve done a lot of the same things we would have asked them to do,” he said.
Ticket Monster CEO Daniel Shin, who is a bit of an Internet star in South Korea, said the company has been modeled after both LivingSocial and Groupon.
“Obviously, we take a lot of best practices from around the world,” said Shin, who moved to the U.S. from South Korea when he was nine and returned in January as one of the company’s founders. “We started last May, and both LivingSocial and Groupon started earlier than that, so any learnings we could take away from them, we did.”
Shin declined to name Groupon as one of the other bidders, but said Ticket Monster was “contacted by a lot of different parties.”
The company raised $11 million in capital from Insight Venture Partners of New York and South Korea’s Stonebridge Capital.
O’Shaughnessy said it will likely continue to make acquistions as it expands globally.
“We’ve been pretty aggressive on that front,” he said.
Photo Credit: Ticket Monster.