What is LivingSocial? LivingSocial Review

history

In 2007, four good friends, Aaron Batalion, Tim O'Shaughnessy, Eddie Frederick and Val Aleksenko, founded a technology consulting company called "Hungry Machine". The first thing they did was to develop apps that were hooked up to Facebook, such as voting apps.

Later, "Hunger Machine" became a company that sent emails with business sales information to customers.

In 2009, "Hunger Machine" was renamed LivingSocial.

Business Model

Livingsocial launches a group buying deal every weekday in each of its service cities, with group-buying products or services at least 50% off. Stores participating in group buying activities do not need to pay any upfront fees, and Livingsocial collects about 30% of the revenue commission. Similar to many group buying models, users can only activate and use group buying coupons after the group buying transaction is completed.

Users can log on to the Livingsocial website or obtain group purchase information via email. After successful purchase, they will receive a redemption voucher in an email around 10 am the next day. They can choose to print the redemption voucher for consumption, or download the voucher to Google Android phones or Apple iPhone, iPad, iTouch and other devices. While Livingsocial has made a lot of money in the group purchase business, it has not forgotten the nature of an application developer. Excellent multi-platform applications also provide strong support for the group purchase business.

Livingsocial does not set a minimum number of group purchasers. Users do not have to worry about losing out on discounts due to too few group purchasers. In addition, in order to encourage more users to participate in group purchases, Livingsocial also launched a new "promotion for free" model. After a user purchases a group purchase, he or she can send the group purchase link to his or her friends. If he or she attracts three other friends to purchase, the promoting user can enjoy free discounts.

After the success of promoting group buying in the catering industry, the young people of Livingsocial began to get restless again. They kept trying new service projects, such as museums, SPA massage and even indoor skydiving. Livingsocial's group buying projects became more and more unique.

Perhaps they are all young people with a "want to have fun". The successful O'Shaughnessy even rides a SEGWAY electric scooter to work every day. Livingsocial has keenly discovered the need for urban young people to seek a relaxing and exciting vacation. After launching weekend adventure group purchases several times to test the market demand, in October 2010, Livingsocial acquired New York outdoor adventure vacation company Urban Escapes, and launched a tailor-made leisure vacation service for young people in major American cities.

employee

In 2014, LivingSocial laid off 400 employees and 200 more in 2015, leaving it with a workforce of about 800, down from 4,500 in 2011. In 2016, it laid off half of its remaining workforce. The company went from 4,500 employees in 2011 to about 200 in 2016.

Leadership Changes

In March 2012, co-founder Eddie Frederick resigned as president and from the board of directors.

In March 2013, co-founder and CTO Aaron Camp stepped down from his position.

In January 2014, LivingSocial CEO Tim O'Shaughnessy announced his resignation, continuing to serve as CEO until the name change.

In July 2014, Gautam Thakar, then CEO of eBay Shopping.com, was to take over as CEO.

Hacker Attacks

In April 2013, LivingSocial, the second largest group buying website in the United States, was hacked. The attack affected more than 50 million users, and LivingSocial has notified users to reset their passwords. Except for Thailand, Malaysia, Indonesia and the Philippines, which were not affected because they used different systems, other LivingSocial users may have been attacked. However, because consumers' credit card and customer financial information data were hashed and encrypted, they were not obtained by hackers.

Acquisitions

In October 2010, Livingsocial acquired Urban Escapes, a New York-based outdoor adventure vacation company, and launched tailor-made leisure vacation services for young people in major American cities.

In 2011, LivingSocial acquired a majority stake in Spanish group buying website Let's Bonus SL and entered the Spanish, Italian, Portuguese, Argentinian and Mexican markets. In 2015, it sold LetsBonus.

In March 2011, LivingSocial acquired Ruby/Rails consulting company InfoEther. Ruby on Rails is the framework that LivingSocial runs on.

In June 2011, LivingSocial acquired DealKeren, which offers daily deals in Indonesia, and its parent company Ensogo, which offers daily deals in Thailand and the Philippines.

In August 2011, LivingSocial acquired TicketMonster for $350 million. TicketMonster was one of the largest daily deal sites in South Korea with an annual operating expense of $800 million. In November 2013, LivingSocial sold TicketMonster to Groupon for $260 million.

In March 2012, LivingSocial purchased Jump On it for $40 million.

In April 2012, LivingSocial acquired mobile and online ordering provider ONOSYS. ONOSYS operates in Cleveland, Ohio, and serves more than 75 restaurant chains, including Papa John's Pizza International Inc., Panera Bread and Applebee's International Inc.

develop

In 2009, LivingSocial acquired a small company BuyYourFriendADrink, whose main business was to promote new products of wine companies and boost offline sales by attracting online users to bars.

In January 2010, Livingsocial raised $5 million in Series B funding, with funds still coming from Grotech Ventures and AOL founder Casey.

In March 2010, Livingsocial raised another $25 million in funding, with US Venture Partners joining the group in addition to Grotech and Case.

In December 2010, Amazon invested $175 million in LivingSocial.

In 2011, LivingSocial had revenue of $238 million but a loss of $499 million.

At the end of 2011, LivingSocial planned to raise $400 million in funds, but ultimately only received $176 million.

On February 21, 2013, LivingSocial received an additional investment of US$110 million from investors.

In October 2016, LivingSocial, the second largest group buying website in the United States, announced that it would be sold to Groupon at a discount.

References

• 1. The founder of LivingSocial may be "resigned" in the near future: Share five major business lessons: Chuangyebang [cited on 2014-01-19T16:00:00.000Z]
• 2. American group buying website series: Livingsocial startup story: Sina Technology [cited on 2011-01-09T16:00:00.000Z]
• 3. LivingSocial, the second largest group buying website in the United States, enters China: techweb [cited on 2011-01-17T16:00:00.000Z]