We predicted several months ago that activity for buyouts, mergers, and just plain old shutdowns would increase before year end. Has it ever.
Here are some tidbits as to the kind of activity we are seeing:
* We are personally involved in helping 5 deal sites and a couple of aggregators sell.
* We know of atleast another 5 that are selling that we are not involved in
* There are rumbles about some of the top sites in Canada (not saying) that could be looking for an exit or further survival funds.
* We anticipate being involved in another 5 or so Deal services for sale by end of January
* And there are several financial groups forming as we speak that would like to start consolidating the market in Canada by buying out key deal services across the country and forming one larger entity.
* So who is buying? Existing Deal services wanting to expand, attract a niche or other, private investors wanting to get into the space, media companies finally realizing that deals are the new advertising banner units, investment groups wanting to consolidate.
Although there are still deal services being launched every month, those selling, merging or disappearing are increasing in numbers quickly. We fully anticipate that January will bring lack luster sales for most sites. Many will start panicking. By February they will start freaking out and many will want to sell or get out. We do not blame them. The Daily Deal space absolutely has barriers to it. It is damn expensive to grow a successful and thriving service that is PROFITABLE. The market must get rid of at least half of the 150 or so existing sites in Canada in order for it to be healthier.
As always, if you are wanting to buy a daily deal service or Sell one, get a hold of us to help with valuation, market conditions and certainly to put you in touch with potential buyers and sellers.
We wish all deal site owners and staff a very happy holiday, a restful end of year and a successful start for 2012.