RetailMeNot Inc., based in Austin, has acquired Giftcard Zen Inc., which started in Flagstaff, for $22 million in cash, plus up to an additional $11 million based on specific performance targets and other requirements.
Giftcard Zen is a website where gift cards can be bought and sold at a discounted rate. Founder Aaron Dragushan launched the company out of his Flagstaff home and expanded with a Phoenix office two years ago.
“GiftCard Zen shares the same mission with RetailMeNot, to help consumers save money when they shop at their favorite retailers, restaurants and brands,” said Dragushan. “I’m incredibly pleased we are joining a company and culture that values the business we’ve built over the past three and a half years.”
Brian Hoyt, vice president of RetailMeNot Inc. communications, says the acquisition of GiftCard Zen accelerates RetailMeNot’s strategy of providing consumers with more ways to save across the shopping journey.
“There’s an enormous opportunity in unused gift cards for consumers to save money,” he said. “One study estimates that approximately $44 billion in unused gift cards had accumulated in the United States between 2008 and 2014 and could have been made available for sale on the secondary gift card market.”
Hoyt said that the addition of GiftCard Zen’s discounted gift cards alongside RetailMeNot’s e-commerce and in-store coupons and rebates will drive more people to the company’s mobile app and websites, and ultimately result in more money-saving opportunities.
“RetailMeNot wants to be the one-stop shop for savings when a consumer shops at one of our thousands of retail partners or takes their family to a restaurant. GiftCard Zen is a great fit with RetailMeNot as its inventory of discounted gift card content will provide consumers another meaningful way for RetailMeNot to fulfill our mission to help people save money,” said Cotter Cunningham, CEO & Founder, RetailMeNot, Inc.
The transaction closed on April 5. GiftCard Zen will continue to operate out of Phoenix.