Switching Gears
SeatGeek, which sells tickets to live events through its mobile app, has raised $238 million in private funding after terminating a deal that would have taken it public. Founded in 2009, the company previously agreed to merge with a group that counts longtime Oakland Athletics GM Billy Beane among its investors.
Citing challenges for rapidly growing companies, the merger has been canceled, paving the way for this alternate fundraising. It also speaks to the current macroeconomic environment where a number of startups have either delayed or canceled public listings. Following the infusion of private capital SeatGeek is valued at $1.2 billion, which is down from an estimated $2 billion had the company hit the open market.
Surging Demand
SeatGeek is based in New York and has close to 200 clients, including the NFL’s Dallas Cowboys. It both sells tickets directly to customers and maintains an online marketplace where tickets for concerts and sporting events can be bought and sold. StubHub (EBAY), Ticketmaster (LYV), and Vivid Seats (SEAT) are among its competitors.
Demand for live events plummeted in 2020 as COVID-19 spread, but the sector has experienced a strong rebound lately. SeatGeek executives say this new funding highlights the firm’s steady growth, adding increased demand for live-events is offsetting inflationary concerns.
SeatGeek’s Game Plan
This latest funding will reportedly be invested in SeatGeek’s software as well as a program that lets users return tickets for credits good toward future events. Ticket upgrades could be another future option, as well as food-and-beverage ordering capabilities.
Over the past few years the company has pumped money into marketing, leading to significant losses. That said, sales were up 30% last year from 2019. Executives describe their efforts as a balance between growth and the desire to become profitable.
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