April 6, 2009, 12:00 AM

Online auction web site Swoopo gets $10 million in funding

Swoopo.com, an online auction site where buyers pay to place bids, has received a $10 million investment from August Capital.

Swoopo.com, an online auction site where buyers pay to place bids, has received a $10 million investment from August Capital.

“Swoopo’s mission is to bring the transparency and thrill back to online auctions,” says Gunnar Piening, CEO, Swoopo. “Since our launch in the U.S. in late 2008, we’ve seen great interest in our site with our monthly transactions growing rapidly. We are now aggressively executing our plan to roll out our brand of entertainment shopping across global markets.”

Swoopo, available in Germany, the U.K., Austria, Spain and the U.S., says it has over 2 million registered users. Bidders purchase packs of bids in denominations of 30, 50, 100, 300 or 700, paying 75 cents for each bid. Each item starts at $.15, and every bid placed increases the price of the product by 15 cents and the auction countdown by as much as 20 seconds. Swoopo says extending the auction to allow participants to get in a new bid helps eliminate last- minute sniping.

The web site, founded in Germany in 2005, was launched in the U.S. late last year. The company says on average, products on the site sell for 65% below the retail price.

Swoopo.com is operated by Entertainment Shopping Inc. based in Cupertino, CA. In addition to August Capital, Wellington Partners also has invested $4 million in the company. Swoopo has 58 employees and offices in Munich, London and Cupertino.

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