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Was it the Right Time to ‘Nab It?
The acquisition of local group buying pioneer GoNabit inspires a plethora of questions in Kipp’s mind…
June 28, 2011 4:46 by Eva Fernandes
Big, big, big news today in the lucrative world of group-buying websites in the UAE. GoNabit, the pioneer group buying website in the UAE has been acquired by Washington-based LivingSocial.
And it just seemed like yesterday when the Kipp team sat down with GoNabit co-founder Dan Stuart a week before the site’s launch, talking about the risks of entrepreneurship, the support the co-founders got from Bayt.com, and the perils of setting up online payment. Was that seriously just last year?
Though the actual figure is still unknown, Kipp’ll be damned if it wasn’t a pretty nifty package that GoNabit co-founders Dan Stuart and Sohrab Jahanbani walked away with.
Currently GoNabit is live in the UAE, Egypt, Lebanon and Jordan. According to reports LivingSocial has acquired 100 percent of GoNabit and as Dan Stuart told the press (he’s planning on sticking with the site by the way) the site is looking to expand into as many markets as it possibly can over in the MENA region.
Of course, it will face tough competition, as the number of group-buying websites launched in the Middle East has risen dramatically over this year, to an impressive estimate of about 20 websites. What with Kipp inundated with emails from Groupon.ae and Wallabananawalla-or-whatever-it-is-called (that seem to email us regardless of our attempts to unsubscribe from the daily newsletter that we never signed up for) we could have sworn there easily more than 20 group buying websites.
LivingSocial which is one of the major players in the US group-buying market, has been on a bit of acquisition spree. In the recent past it has acquired Ensogo, a deal site in Thailand and the Philippines, and DealKeren, an Ensogo company based in Indonesia. It has also launched operations in the Netherlands. So, it goes without saying LivingSocial does have access to international resources that will give GoNabit an edge over regional group-buying sites. But just how advantageous is this acquisition for GoNabit and LivingSocial in the near future?
And, was this the right time to sell? Surely the market is getting claustrophobically crowded, but with GoNabit covering a large market share, should it have remained true to its local roots?
On the other hand, assuming this does works out for everyone, is acquiring successful local brands the way for foreign companies to operate successful businesses in the UAE?