from the February 2011 issue

Groupon acquires Israel's social buying Grouper for $8m.

Grouper is Israel's first social buying site allowing friends to join together to make group purchases at discounts.

Social shopping company Groupon Inc. has entered Israel by acquiring social shopping site Grouper Ltd. The company did not disclose the size of the deal, but sources estimate it at $8 million, in stages over three years based on Grouper's performance.

Grouper will operate under the Groupon label and use its platform. Grouper's founders will likely make several million dollars from the deal.

The acquisition of Grouper is part of Groupon's international expansion strategy. The company simultaneously acquired social shopping companies, SoSasta in India and Twangoo South Africa. Earlier, it acquired three companies in Asia.

Groupon president Rob Solomon said, "Social buying is only just getting started in India, Israel, and South Africa, and we see great potential in all these markets. Groupon is creating and changing marketing by local businesses all over the world."

Grouper is Israel's first social buying site, founded by three entrepreneurs in March 2010. Several competitors have followed, most notably Yemama, Baligam and Buy2 Social shopping sites enable customers to enjoy discounts by joining with friends to make group purchases.

Reprinted from the Israel High-Tech & Investment Report February 2011

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