BuyWithMe: We’re Not Leaving BostonDecember 16, 2010
Boston Business Journal
by Galen Moore
BuyWithMe has bought a new headquarters in New York, but it’s not leaving Boston, says founder Andrew Moss. In fact, the venture-backed Groupon competitor plans to hire about 11 new people here, bringing its headcount to 30, if it can find space larger than the office it currently occupies on Boylston Street in the Back Bay.
Moss said when the company opened a New York office earlier this year, the nominal headquarters moved there because most of the executive team he was hiring was based there. That executive team had some turnover, last month, with the departure of recent hire Cheryl Rosner from the CEO spot. News of BuyWithMe’s change at the top broke yesterday.
Moss declined to speak about the personnel change, but said BuyWithMe is hiring inside and outside sales, email marketing support, editorial, software developers and interns in business intelligence, marketing and design.
For now, the 19-person Boston operation is profitable, Moss said, having “caught up…substantially” to Groupon, which started with 20,000 Boston subscribers to BuyWithMe’s 600. But he sounds like he wants to have headquarters in every city BuyWithMe operates in.
“I want my cake and I want to eat it basically,” he said. “It’s an inherently local business. A lot of why we’ve had success in Boston is we understand the types of deals they want in Boston and the seasonality of it. We did the opening of the frogpond (for iceskating) in Boston for example.”
That doesn’t mean the business can’t scale, he said. As its reach grows past a critical mass, BuyWithMe has taken advantage of new kinds of marketing opportunities - selling digital goods across multiple markets, for example, as BuyWithMe recently did with Shutterfly. However, scaling is expensive and a challenge, he said, pointing to the mega-fundraises and massive reported valuations of Groupon and LivingSocial, the number one and two competitors in the social coupon phenomenon.
“I think it is much harder to scale than people think,” Moss said. “You’d think that people would understand that if you look at the amount of capital that a few companies have raised.”
BuyWithMe, founded in Newton, Mass. in 2009, has raised $21.5 million from Bain Capital Ventures of Boston and Matrix Partners of Waltham, Mass.