LivingSocial Files To Authorize Up To $565M In Series E Funding
Reports of daily deals site LivingSocial being in talks to raise around $500 million in Series E are now backed up by LivingSocial's amended and restated Certificate of Incorporation filed on March 31st and unearthed today by the VCExperts blog.
Context & Ripple Effects
The filing caps a rapid escalation for the No. 2 daily-deals player behind Groupon: since confirming $175 million from Amazon last December, LivingSocial has used loss-leader promotions like its one-million-unit, $20-million Amazon gift card giveaway, added real-time discounts to its mobile apps, and hired former Yahoo ad-sales chief Mitch Spolan to build an enterprise sales operation.
What changed on March 31st is that the rumored round moved into paperwork: an amended and restated Certificate of Incorporation — unearthed by VCExperts rather than announced by the company — now formally authorizes up to $565 million in Series E, up from the roughly $500 million reportedly in discussion. A charter amendment is a legal prerequisite for issuing new preferred stock, so this converts rumor into a near-term raise.
First-order effects
- LivingSocial gains authorization for a war chest sized to fund the group-buying land grab — hiring sales staff like Spolan's team and subsidizing promotions at Groupon-scale burn rates.
- VCExperts' discovery sets the disclosure clock ticking: investors will now expect the round's terms (and implied valuation) to surface through filings before any company announcement.
Second-order effects
- Groupon faces a rival with fresh nine-figure ammunition in a market where customer acquisition is bought through deep-discount promotions, pressuring it to accelerate its own fundraising or IPO timeline.
- Merchant-side pricing tightens across the deals market as both leaders compete for exclusive local inventory, raising the cost of acquisition for any smaller daily-deals site trying to hold territory.
Third-order effects
- If the pattern holds, the social-buying market consolidates into a two-player capital race where scale of funding, not deal inventory, decides who survives — squeezing mid-tier clones out or into acquisitions.
- Late-stage private rounds of this size normalize the mega-financing-before-IPO playbook, making charter filings and investor disclosures a de facto news feed for private-company financials.
The trend: Daily deals is turning from a startup category into a capital-intensive duopoly race between Groupon and a heavily funded LivingSocial, with financing documents replacing product launches as the competitive signal.