With over 46 million subscribers in 25 countries, LivingSocial is the second largest daily deal company in the world. The company, which is in the midst of a $400 million round of funding, recently closed the first $176 million of the round. The remaining $224 million of funds are expected to close in the “coming weeks and months.”
LivingSocial has now raised a total of $808 million in private funding and the latest investment values the company at $6 billion. The round of funding is being led by J.P. Morgan with both Lightspeed Ventures and Amazon also participating. Amazon, who previously invested $175 million in LivingSocial, made its first investment in December of last year. LivingSocial is planning to use the funds for operations and expansions. Neither previous investors or the management team are planning to sell shares or cash out during the round.
LivingSocial had previously announced plans for an IPO in 2011, but abandoned those plans due to economic uncertainty. Groupon, the market leader in the daily deals space, went public in early November. Since going public, the Groupon stock has been extremely volatile and the stock price has fluctuated from a low of $14.85 to a high of $31.14 and is currently trading around $21.00.
Although most industry experts are forecasting this round of funding will set the stage for a LivingSocial IPO, the founder of Tippr, Martin Tobia, is predicting LivingSocial will be acquired by a larger company in 2012:
“By merging with a company backed by both a large Rolodex and bank account, LivingSocial will be poised to successfully leapfrog Groupon and render it a mere also-ran in the daily deals landscape.”
While an IPO or acquisition may be in LivingSocial’s near future, the latest round of funding will provide the company with the financial flexibility and stability it needs to continue battling Groupon for market share.
[Sources Include: SEC, Venture Beat, & Market Watch]
