Fast-growing South Korean daily deal website Ticket Monster has acquired a Malaysian company in the first move of its expansion to other countries in Asia.
Ticket Monster works with merchants to provide shoppers with discounts of up to 50 percent on a range of items including concert tickets, restaurants and gym memberships. It announced Tuesday the acquisition of Integrated Methods Sdn. Bhd., the holding company for social shopping site Everyday.com.my.
Ticket Monster did not disclose the terms of the deal, though in a press release described it as a "strategic investment."
"We want to aggressively grow internationally," Ticket Monster CEO and co-founder Daniel Shin told reporters. He said the company aims to expand into Singapore, the Philippines, Vietnam and Japan.
Edwin Wang, CEO of Integrated Methods, said that his company expects to play a role in that growth.
"Together, we can look to expand aggressively in Malaysia and beyond," he said.
Shin, 25, co-founded Ticket Monster Inc. in May last year with what he describes as "five people and about $10,000 in our pockets."
In just one year the startup's work force has grown to 460 employees with 2 million registered users, a doubling from March when it hit the 1 million mark. South Korean market share stands at 45.7 percent and the company has made two domestic acquisitions.
It expects $300 million in sales in 2011 in an overall South Korean market expected to increase to about $550 million. The company generates revenue by taking a percentage of the price for the discounted tickets sold.
Shin said that on an item discounted 50 percent, the company takes a commission of between 15 to 20 percent of the reduced sale price. Consumers pay the discounted prices by buying the tickets from Ticket Monster on its website and it pays the merchant after taking its cut.
The company got a big boost in August last year when it secured $3 million in funding from South Korea's Stonebridge Capital and Insight Venture Partners of the United States, which has invested in Twitter.
Globally, the exploding daily-deal sector is dominated by Groupon with about 85 million subscribers and LivingSocial with 28 million.
Shin said that Ticket Monster has carefully studied where to expand and Malaysia's increasing Internet penetration rate _ which he said went from 56 percent last year to 65 percent this year _ made the country a natural destination.
"So over the span of one year they grew by 9 percent in terms of Internet penetration and they expect to get to 90 percent in 2020," he said.
Born in South Korea, Shin immigrated to the United States at age nine with his family. The graduate of the University of Pennsylvania's Wharton School and veteran of a two-year stint at consulting company McKinsey & Co. already has a track record as an entrepreneur.
While still a student, he founded Invite Media, a display advertising and exchange bidding company, that was acquired last year by DoubleClick Inc., an Internet ad service owned by Google Inc.
Shin said an initial public offering is an option for raising capital in the long term for Ticket Monster. The company has attracted numerous suitors interested in buying it, but so far is not ready to go down that road, he said.
"We get offers all the time, on like a monthly basis," he said.
"But we're still around just because we think there's a lot of things we have left to do."