Google’s $6 billion offer to buy Groupon Inc. belies the reality that group buying is a crowded and immature sector in which local companies are experiencing varying levels of success. And while some are finding it difficult to attract investors, a new one is jumping into the mix with a healthy dose of investment capital.
Austin entrepreneurs said investors are hesitant to back local group-buying companies despite Chicago-based Groupon’s popularity and Google Inc.’s (Nasdaq: GOOG) recent attempt to buy it. Officials at Localiter LLC and GivEngine Inc. said they’re meeting few takers when seeking the expansion capital needed to grow their businesses in the Groupon tradition.
In contrast, Austin-based Moolala Inc. reported receiving $384,000 in funding from seven investors this week, according to a filing with the U.S. Securities and Exchange Commission. The group-buying company, which has been operating in stealth mode since it was founded in November, is led by Joshua Chodniewicz, the former CEO of California-based Art.com Inc.