“Flash sales” company Gilt Groupe gets $43m growth investment

The new financing will be used to secure Gilt Groupe’s position as US market leader in online flash sales, an ecommerce model that has seen rapid growth in recent years.

Since its launch in November 2007, the company’s flagship property at Gilt.com has built a passionate consumer following with daily flash sales of luxury and designer goods at members-only pricing. The company has quintupled its membership in the past year, with 1.3 million registered members in the US and more than 200,000 on its five-month-old Japanese site. Company revenue for calendar year 2009 is expected to be in excess of $150m.

“At General Atlantic, we look to partner with great management teams to strengthen and propel exceptional companies to their next phase,” said managing director Anton Levy, who is joining the Gilt Groupe board in connection with the financing. “We are very excited about the opportunities we see with Gilt Groupe. Its passionate customer base and impressive growth speaks to the strength of the business model, even in tough economic times, and validates our decision to invest in the company.”

“We couldn’t be happier that General Atlantic has chosen to invest in Gilt Groupe, and look forward to working with Anton Levy and the GA team,” said Susan Lyne, CEO of Gilt Groupe. “The company’s impressive track record and investment philosophy make them ideal partners and a valuable resource as we execute on our aggressive growth plan.”

Gilt Groupe plans to leverage its successful private sale model with new category launches targeting aspirational and enthusiast consumer segments. This month, the company will launch Gilt Fuse, a contemporary fashion site for younger members, followed by a vacation travel site, jetsetter.com. As a result, Gilt Groupe expects to host over four thousand sales in 2010, up from fifteen hundred in 2009.

Established in 1980, General Atlantic manages around $13bn in capital for growth investments.

Matrix Partners is an early stage venture capital firm which typically focuses on technology, internet and software companies.

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