GiftCard Zen
Buy, Sell, and Trade Gift Cards Online.
| Date | Investors | Amount | Round |
|---|---|---|---|
| - | investor investor | €0.0 | round |
| investor | €0.0 | round | |
$22.0m | Acquisition | ||
| Total Funding | 000k | ||
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GiftCard Zen operated as a secondary marketplace for gift cards, facilitating a consumer-to-business-to-consumer model. The company was established in 2012 by founder Aaron Dragushan, who launched the venture from his home in Flagstaff, Arizona, before expanding to a Phoenix office. Dragushan, a serial entrepreneur, had previously created FastCustomer, an app recognized by TIME magazine, born from his personal frustration with waiting on hold for customer service. His entrepreneurial drive dates back to his youth, where he started a web design business and consistently developed new ideas.
The core of GiftCard Zen's business was to purchase unwanted or unused gift cards from individuals and then resell them at a discount to other consumers. This addressed the significant market of billions in unused gift card value. The platform served both individual consumers looking for savings on everyday purchases and business clients, such as construction contractors, who could achieve cost reductions by buying large volumes of discounted gift cards for supplies. Revenue was generated from the spread between the price at which it bought the gift cards and the discounted price at which it sold them. The company offered cards for over 700 different retailers, brands, and restaurants.
In a significant milestone, GiftCard Zen was acquired by RetailMeNot, a prominent digital savings destination, on April 5, 2016. The acquisition was valued at $22 million in cash, with a potential for an additional $11 million based on performance targets. The move was a strategic play by RetailMeNot to expand its savings offerings beyond digital coupons and enter the substantial secondary gift card market, aiming to increase user frequency and engagement on its platforms. Following the acquisition, the GiftCard Zen team was to continue operating from Phoenix, integrating its inventory and operational capabilities into RetailMeNot's gift card business unit.
Keywords: secondary gift card marketplace, discounted gift cards, gift card exchange, buy gift cards, sell gift cards, RetailMeNot, Aaron Dragushan, online savings, e-commerce, consumer savings, retail discounts, gift card resale, Phoenix startup, digital coupons, customer savings, brand discounts, restaurant gift cards, online marketplace, e-gifting, secondary market