Gilt Groupe is an online retailer that offers discounted goods and services organized into categories like women's, men's, home, and children's products. It uses a limited time "private sale" format. The company has grown rapidly since 2008 and is looking to raise $80-100 million to expand its market share and compete against other daily deals and retail sites. Major investors in Gilt Groupe include General Atlantic, Matrix Partners, and TriplePoint Capital.

1. Gilt Groupe Overview
Business Description
 The company offered discounted goods and services
organized into six major groups:
 Women:
 Clothing, Jewelry, Cosmetics, Shoes and Accessories
 Men:
 Clothing, Jewelry, Cosmetics, Shoes and Accessories
 Home:
 Bedding & Bath, Dinnerware and Other Home Decors
 Children:
 Clothing, Shoes, Toys and Keepsakes
 Gifts:
 Shopping by Occasions and Loved Ones (Pets)
 Jetsetter:
 Vacation Package to High-End Travel Destinations
 City:
 City-based Daily Deals on Dinning and Events
Investment Summary
 Gilt Groupe’s deal is valued at $1 billion
 The financing deal will be at 2X revenue
 Comparable Transaction:
 Nordstrom’s purchase of HauteLook
 HauteLook’s Revenue:
 2011: $150-160 Million (expected)
 2010: $115 Million
 New capital will be used to:
 Expand market share
 Fend off competitions:
 Newcomers: Groupon and Living Social
 Subsidiaries of larger players:
 Amazon: Buy VIP
 Biley Bank & Biddle: Blue Nile
Funding History
 Initial funding was provided by:
 Kevin Ryan, former CEO of double click
 Dwight Merriman, former CTO of double click
 Gilt Groupe has raised $ 171 million dollars from:
1. TriplePoint Capital ($15Mn) in Dec 2010 (9%)
2. General Atlantic ($78Mn) in Aug 2009 (45%)
3. Matrix Partners ($78Mn) in Aug 2009 (46%)
Gilt Groupe is looking to raise $80-100 million from private-market investors.
Company Overview
 Headquartered in New York, NY
 An online retailer with a “private
sale” business model
 A limited time sale format
 Customer base grew from 60,000
(2008) to 1.6 million (2009)
 Competitors (Business Area):
 Rue la la (All Areas)
 Hautelook (All Areas)
 Ideeli (All Areas)
 JackThreads (Men)
 Zulily (Children)
 One Kings Lane (Home)
 Groupon, Living Social (City)
Financial Summary
Fiscal Year Revenue:
• 2010: $ 500 Million
• 2009: $ 150 Million
• 2008: $ 25 Million

2. 45%
46%
9%
Gilt Groupe Private Ownership
General Atlantic LLC
Matrix Partners
TriplePointCapital,LLC
“Private Sale” is a rapidly growing industry within Internet Retail
Both Traditional Retailers and Media Companies are expanding their reach in E-Commerce
Industry Overview
 The “private sale” concept was made popular by
Vente Privee; it made $750 million in revenue 2009.
 The industry thrives by working closely with designer
labels; this new breeds of e-commerce sites are not
merely a discount-sale website.
 These “private-sale” sites collaborate with label
through educating their members about brands,
building awareness and operating as an extension of
label’s online marketing efforts.
 The members-only sites have a very selective group
of brand-conscious consumers (between the age of
25-35) with high level of discretionary spending.
Financial Acquiror
 Investment firms are interested in e-commerce based
internet retailers such as Gilt Groupe because they
are growing rapidly and provide excellent returns for
their investors.
 Consumers are increasing their spending on high end
luxury goods. Research indicates:
1. Growing income enable consumers to afford
increased consumption of branded goods
2. Consumption becomes more social-identity driven
among middle class and above so as to increase
the demand for premium and luxury brands.
Source: Capital IQ as of March 21, 2011.
Strategic Acquiror
 Traditional Retailers are acquiring “private sales”
websites in order to compete with other luxury
retailers. For example, Nordstorm bought HauteLook
to compete with Neiman Marcus who have created
their own private sales sites.
 Media companies such as Thrilllist acquired
JackThreads in May 2010. The “private sales” sites is
complimentary to their existing business model. Media
companies can quickly expand their customers based
through acquiring members-only sites who has loyal
followers who also have a track record of spending.
Strategic Acquiror
Traditional Retailers
 Nordstorm
 Amazon
 Blue Niles
 Buy.Com
 Costco
 eBay
 J. C. Penny Company
 Neiman Marcus
 Ross Stores
Strategic Acquiror
Media Companies
 GSI Commerce
 Retail Convergence
 Thrill List
Financial Acquiror
 Constellation Ventures
 Kodiak Venture Partners
 StarVest Partners
 August Capital
 Maveron
 Trinity Ventures
 Greylock Partners
 Eastward Capital Partners
 General Atlantics
 Matrix Partners
 TriplePoint Capital
 Pinnacle Ventures

3. List of Interested Parties
Financial Acquiror Strategic Acquiror
Investment Firms Traditional Retailers Media Companies

4. Recent M&A Activities in “Private Sale” Industry
Selected Transactions in Comparable Companies
Company Closed Date Acquiror Structure Type Target Description Deal Value
Feb 2011
(announced)
Nordstorm Acquisition Strategic
HauteLook is a private club which organizes exclusive 48-72
hour on-line private sales for its members. It provies an
exclusive platform where top designer brands can reach their
customers directly. It has over 1,000 high profile brands and
host more than 2,500 private events for women, men, kids,
home and beauty. The company is based off Los Angeles,
California and founded in 2007.
$ 270 Million
May 2010 Thrilllist LLC Acquisition Strategic
JackThreads is a members-only, online shopping club that
cruates top-tier street, skate, surf and contempory men's
fashion brands in private sales event fashion that last up to
72 hours. The company was lauched on 2008 in order to fill
the void for great deals on exclusive men's apparel. In May
2010, the company teamed up with Thrillist.com, a leading
digital lifestyle publication for men that reaches over 2 million
subscribers.
$ 10 Million
Nov 2009
Constellation Ventures,
Kodiak Venture Partners,
StarVest Parnters, L.P.
Acquisition Financial
ideeli, Inc. owns and operates an online shopping community
that connects luxury brands with consumers. The company
was founded in 2006 and is based in New York, NY. It is a
members-only network of fashion devotees and fans of high-
end bags, accessories, jewelry, fragrances and other items.
ideeli offers deeply discounted luxury items via alerts to its
subscribers in text message or e-mail form.
$ 66 Milion
Oct 2009 GSI Commerce Acquisition Strategic
An invitation only sample sale website. It is one of the portfolio
companies backed by Retail Convergence. The company was
sold to GSI Commerce including another business,
SmartBargains. In 2009, Rue La La has 1.2 million mebers
and Gilt's 1.6 million. The user base has expanded
dramatically since then.
$ 370 Million
Jul 2009
August Capital, Maverson
LLC, Trinity Ventures
Acquisition Financial
Zulily focuses only on kids' apparels and already has more
than a million customers. The company was founded by a
former Blue Nile CEO Mark Vadon, who is an e-commerce
retail veteran. The company was founded in 2009 and is
based in Seattle, Washington.
$ 12 Million
Mar 2009
Kleiner Perkins Caufield &
Byers, and Greylock
Partners
Financing Financial
One Kings Lane is a private online sales desitnation
specialized in designer décor, funiture, accessories and gifts.
It provides limited sale events for members who have access
to limited quantities of high-end designer goods at up to 70%
off. The company is based off Los Angeles, California and
founded in 2009.
$ 23 Million
Source: Capital IQ as of March 21, 2011.