The target is a unique digital business model that has been highly successful for 7 consecutive years. This Internet Company is the dominant leader in the United States for Entertainment Auctions, offering consumers – through a fun pay-to-participate auction model – the ability to win brand new electronics, kitchen appliances, gift cards, fashion items and more – at prices that are up to 95% off retail.
The company’s primary auctions and bidding occurs around gift cards and new brand-name consumer products, especially new tech products. This includes, but is not limited to, Walmart Gift Cards, iPads, Digital Cameras, HDTVs, Kitchen Aid Mixers, and Dyson Vacuums. Each auction will have an auction winner, who will be required to pay the closing price. However, each winner has also invested bids at $0.60 and has pre-purchased these through buying bid packs. For losers of the auction, they can apply their bids towards a “buy-it-now” functionality, which allows the user, if they choose, to apply all used bids in that particular auction as a credit toward the retail price of the item, thus paying the company the difference to receive the item.
Over the past 7 years, the company has built up a large vendor and product base, with over 100 vendor partners and 10,000 unique products for users to bid on. The entertainment auction/penny auction market has consolidated since the initial fanfare of the model, starting back in 2009. For the last couple of years, only 2 companies (including the target) operate in the space, owning 90%+ of the market. Sales drivers are mostly tied to word of mouth and direct response acquisitions.
Current ownership has a number of other opportunities that they have gravitated towards over the past several years, taking their eye off of this business to focus on others. In the right hands, this company can easily surpass where they are today and scale for a number of years to come. This is a unique, low competition business that still generates a very strong monthly cash flow.
This Internet Company Represented by:
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Tech & Internet Business Brokers