As a regular user of StubHub, Viagogo's $30 million series C round and expansion into the United States announced yesterday confuses me.
As for the funding itself, I find it curious that Index Ventures, which led Viagogo's $20 million series B round last year, would want to lead this one as well. Company CEO Eric Baker told The Deal's Paul Bonanos that the comapny raised this round "from a position of strength," whatever that means. But, I guess Index thinks Viagogo is such a hot company it wanted to keep most of it for itself.
A bigger question is how Viagogo's expensive expansion into the United States will go. Baker says the market is immature and no single firm has more than 10% of the market. Maybe, but it seems the same rules apply to the secondary ticket market as apply to the secondary goods market. Users migrate to the most liquid market. And now, that is StubHub. Sure, eBay could mess StubHub up, but eight months after announcing their acquisition of the San Francisco company, there's no sign that is happening.
A few seconds after physically receiving my tickets to this season's 49ers preseason game with the Raiders, I listed them on StubHub. It's more convenient than Craig's List and no other online secondary ticket marketplace attracts as many prospective buyers as StubHub. Viagogo may be able to compete on price, but what I lose in the 15% fees paid to StubHub, I probably gain in a higher overall price.
As I wrote last year, I like Viagogo's original strategy of playing geographical arbitrage by launching in Great Britain. I'm just unsure why Index didn't bring in a new lead investor and how the company's US expansion will go.
For more on Viagogo's funding, see:
VentureBeat
The Deal
Tags: viagogo, tickets, stubhub, vc, venture+capital
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