Kleiner Perkins, one of the Silicon Valley’s better known firms, has co-led an investment in Beverly Hills ticket company RazorGator (we write rarely about non-Silicon Valley companies, about as rare, in fact, as Kleiner Perkins’ investments outside the valley).
Gee, we’re thinking, that’s a lot of money for an online sold-out ticket vendor. We can’t imagine the technology is all that deep. So looks like the $26 million will be spent on aggressive marketing. There is competition, from StubHub Inc, eBay and Craigslist, notes VentureWire (sub req). Kleiner’s Russ Siegelman will take a board, giving him a chance to head south occasionally — perhaps timed for sold-out Lakers games? (Gotta be good discounts based on how they’ve played recently.)
5 Comments
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Chris Zaharias said:
The challenge in a business like RazorGator’s is how to put those marketing $$ to use. If online marketing is to be the majority of their marketing, it’s very hard to apply technology. What technology, for example, can figure out which NBA team is going to advance in the playoffs, and therefore how much to spend on keywords related to the NBA playoffs?
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jeff said:
I remember saying the same thing about AuctionDrop when Mobius invested, then they pulled a huge deal with UPS out of the hat and the business started to look pretty damn attractive.
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Andrew Leyden said:
This one stumps me. Razor Gator is already locked in with a number of the major sporting events, including the US Olympic Commitee. They have a nearly 100% markup on the tickets they sell, yet they are taking a $26 million investment? What the heck for? Advertising?
Maybe they are going to enter the ticketmaster world of “exclusivity” with specific stadiums. I don’t know–seems like a dumb investment for a company. Can’t imagine raising money from VCs when I sell a product at 100% + markup…
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James said:
What are the chances of Razor Gator going public in the near future? Anyone? Or being acquired? Would watching this company be a waste of time?
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Wilie said:
The question is are they spending more money getting the sale then they are making on the sale??
One Trackback
11:53 am
LiveStub hopes to nuke StubHub, others, with commission-free scalping » VentureBeat said:
[...] dropped $265 million to get its hands on TicketsNow, and top-tier VC firm Kleiner Perkins led a $26 million investment in RazorGator back in 2005. All of these companies make money charging sellers a 15 percent [...]