Viagogo invades US online ticket-scalping market
Some entrepreneurs are bold, or foolhardy, depending how you look at it.
Eric Baker, co-founder of online ticket scalper StubHub, left in 2004, before StubHub went on to sell to eBay in January for $310 million.
Instead, he started rival Viagogo in London in 2005. The company has just raised $30 million in a round led by Index Ventures.
Like Stubhub, Viagogo allows people to buy and sell previously-purchased tickets on the web for sports games, concerts and other live events.
Baker, Viagogo’s chief executive, says he will use the additional funding to go head-to-head with Stubhub in the US, having cashed out his ten percent ownership of Stubhub in the sale to eBay, with no problematic non-compete clause to stop him (previous coverage here).
The online marketplace in the US for buying and selling second-hand tickets is wide open, says Baker — although other established online ticket marketplaces include RazorGator and Tickets Now. Viagogo’s beachhead: A non-exclusive distribution deal with the Cleveland Browns (American) football team.
The total online ticket sales market in the US — including both scalpers’ tickets and tickets sold directly from Ticketmaster or venues themselves — will be worth more than $10 billion within the next few years, says Baker. He cites a Forrester Research study suggesting it was $4.3 billion in 2006, based on 27 percent growth over the previous year.
Viagogo, to its advantage, has a legal lock on some ticket sales in Europe. In England, “hooligan laws” restrict reselling rights to a single vendor in order to keep thuggish fans out of the stands. Viagogo has an exclusive license to re-sell tickets for Manchester United and other world-famous soccer (football) clubs — brands that it hopes will help grow its reputation in the US.
Viagogo will bring in “tens of millions of dollars” in ticket sales this year, according to Baker, although he would not disclose specific revenue or traffic numbers.
However, Ticketmaster is bringing a variety of court cases against online ticket resellers in the US, in hopes of promoting its own service, TicketExchange; it is also being sued by sports teams for doing so.
Besides Index, other investors include LVMH Chairman Bernard Arnault, German media mogul Dr. Herbert Kloiber, and international financier Lord Jacob Rothschild through his family’s interests. Viagogo has previously raised $20 million.
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About the Author, Eric Eldon
Eric currently covers digital media technology and business news, especially what's happening on social networks and their platforms. He also writes and edits stories about venture capital, and lots of other stuff, too. He started at VentureBeat in the spring of 2007, half a year or so after Matt Marshall left his reporting job at the San Jose Mercury News to found the site. Eric previously cofounded a startup called Writewith, that was building editorial software for newspapers and other groups of writers. The startup didn't work out, but he learned a lot.
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