We have a thing for Taiwan’s group buying market because compared to its Chinese counterpart, it seems to be a relatively healthy and growing scene according to the numbers put together by the folks at Goodlife. Once upon a time we guessed that Living Social would try and buy second place groupbuying site Gomaji, but it seems that Yahoo has more interest in the site, as the two companies announced yesterday that Yahoo has increased its stake in Gomaji to 20%.
Details of the deal have not been released, and contacts at Yahoo were not forthcoming when contacted, but a rough guestimate (based on number of deals per month by average price of deal) show that Gomaji had roughly $25 million in revenue in 2011. Even at a conservative 4 times earnings price multiple, a 20% stake in Gomaji could be worth in the region of $20 million US. No indication exists, however, whether this was a combined total for Yahoo’s investment in Gomaji.
According to Gomaji’s website, the deal was reached in January but the firms only announced it yesterday, presumably once the contracts had been signed and the money was in the bank. Yahoo’s Taiwan PR Manager Zhou Meiyu (周美瑜) said the company was looking to further entrench Gomaji’s position and develop their existing mature business model.
Aside from holding the market’s #2 position, Gomaji was also the first of Taiwan’s 20+ group buying sites to offer travel deals and an LBS mobile platform as well the group buying magazine ENJOY LIFE, perhaps further reasons why Yahoo saw an opportunity to raise its investment.
Yahoo was taken off guard by the group buying trend in Taiwan; as Goodlife’s statistics show, Yahoo Discounts lag behind seven rivals, including Groupon, Gomaji, 17Life and even Lashou, mainland China’s leading Groupon clone. Its investment in Gomaji ensures that it continues to have a hold in the market, though Ms. Zhou stated that there are no current plans to integrate Yahoo’s own deals with Gomaji as yet. Yahoo currently runs three other e-commerce services in Taiwan, including Yahoo! Auctions, Yahoo! Shopping Center and Yahoo! Super Mall.
Gomaji was founded in June of 2010 and quickly rode the coupon craze that swept through Taiwan’s e-commerce market. Trailing behind Groupon once it acquired AtlasPost in late 2010, Gomaji signed a deal in October of that year with Yahoo, Taiwan’s largest portal, allowing it to rapidly grow. Following this they also entered a partnership with HappyGO, a loyalty card that includes more than 200 retail outlets, Taiwan’s third largest mobile carrier FarEasTone, and local convenience store FamilyMart, whose famiport POS terminals feature Gomaji deals.