We’re Spreets ahead of Cudo
In this guest post, Dean McEvoy, CEO of Spreets – which was sold for $40m this week – takes issue with Cudo’s claim to be the number one group buying site.
Over the past 24 hours, we’ve been pretty blown away by the attention we’ve got about the acquisition of Spreets by Yahoo!7. We’ve also been amused by the attention that Cudo has given to the deal.
We’ve been even more amused by the fact that they are claiming market leadership based on Nielsen audience numbers.
Has anyone told them yet that they are running a group buying business, not an online advertising business?
Today’s deal!
$10,000 of good, hard competitive chest beating for the price of two blog posts!
Providing of course, you get 800 people to check it out.
Buy Now.
P.S I completely unbiasedly only use Spreets BTW FTW.
Deal sites in general certainly seem like a massive bubble to me as the market gets saturated and the deals become diluted due to competition.
Today’s Catch Of the Day, which used to be awesome almost without fail, was a box of chocolates at half price.
Congrats Dean for getting out at the right time!
Dean, it is great to see the traction you’ve achieved since pitching for funding at Innovation Bay early in 2010 and congrats on the sale to Yahoo!7. You’ve come a long way since I first saw you pitch Booking Angel and have proven yourself to be a capable entrepreneur.
There are a few things that are confusing about this deal. One is perhaps a communication issue – did you get acquired for $40m, ie was the value placed on Spreets or did you get acquired because you’ve saved $40m for Australians – whenever I see the same number spread around the media I can only think co-incidence is unlikely.
The second thing that puzzles me is how Yahoo!7 could only buy the Spreets business and not the underlying technology platform (Dealised). I am sure there is some M&A logic at work here, but it is beyond me.
I imagine that whether Spreets, Cudo, Jumponit or anyone else currently has a leading market share in Australia is somewhat trite what with Groupon now actively recruiting a sales team here and Google having entered the social commerce space.
I look forward to your next chapter!
Hey Randall, Thanks for the kind words. To clear up the confusion. We aren’t disclosing the selling price but its around $40million and yes the amount we have saved Australians is also coincidentally also around $40million. I just looked it up in our reporting system and to be exact the amount we have saved is $41,231,698.
Regarding IP. They did acquire the IP in the underlying platform for Australia and New Zealand. Dealised owns the IP for other markets.
Groupon or Startdeals will be starting from a cold start. We already have an awesome sales team, half a million members plus Yahoo7 who will be investing significantly in making sure we stay number 1.
Hi Dean,
Congrats on your big news this week. looking forward to seeing how the group buying market unfolds and develops in Australia. I think its great there is some healthy competition.
Be curious to hear your thoughts on the speculation of google’s entry into the space.
http://mashable.com/2011/01/20/google-offers/
Dino
They have been using their Hotmail traffic to claim the largest reach in Australia for years and we all know the value of a Hotmail customer logout. Pretending bulk numbers count has suited them well for ages.
Nice deal BTW – congratulations. You guys pulled it off without the support of a large portal.
the deals that are available today are the cream-of-the-crop, and as industry expands the bulk of the deals will become more ordinary. Early adopters of Groupon will tell you it has already happened in the US. Also, will these sites go the same way as Wotif, Lastminute, and the also-rans where a “special” deal for a hotel is duplicated across all sites?
That being the future case imho, I think Dean made a positive strategic move going with Yahoo!7 because consumer reach & brand-recognition in this space will be a critical multiplier in building future value.
Direct-response marketing has always been a very powerful sales method – it’s amazing it took this long before this apparent boom!
PS: Well done Dean.
With so many of these individual deal sites propping up, wouldn’t the smartest thing to do be to create a site that CONSOLIDATES and compares them all?
Just saying…
Great site, great sell, great time to get out before the market dilutes. Congrats Dean!
I agree that there will be a majority of group-buy deals that are duplicated across multiple sites. And with that, so will the value of the group-buy businesses, however, someone will still become a clear winner, and with that, plenty of ticket clipping revenue!
Meanwhile, every second big retailer is already planning to ramp up their own daily deals on product (group-buy-style), so it will be interesting to see what happens there too.
The question will be around how not to cannibalise their own businesses.
I’ve signed up to quite a few of these sites, and have observed the following:
1. The deals are predominantly based in the inner west
2. The deals are predominantly gym & salon deals
There are some great deals on there, but if this is the “cream-of-the-crop”, I shudder to think what the dregs will be like.
Hi Dean,
Keep on Shipping!
Brilliant stuff.
CK
They are already being consolidated.
group buying sites:
http://www.allthedeals.com.au/.....eals.shtml
Daily deals:
http://www.allthedeals.com.au/
Hey @Reka that’s awesome, will keep my eye on those sites!
Dean
We all live in a world where we claim our businesses to be something that they’re not. Spreets claim to be the first group-buying website in Australia is entirely false – Spreets weren’t even second! Fact.
Hey Dave, I can guarantee you we were the first to launch. Here is the link to the first deal we ran on the 4th of Feb last year. http://spreets.com.au/deal/Syd.....aurant-bar
None of the others had launched. Hope that clears it up for you.
Dean
My friends and I also set up a site that consolidates deals like this, Dealsguide. We also have an iPhone app (free, no ads), that does the same thing.