Bonanza for Bonanzle: Startup Changes Name, Buys 1000Markets, Leads Social Commerce Wave
The Seattle-based online marketplace Bonanzle is on the move today. The company announced it has changed its name to Bonanza (it now uses Bonanza.com), and has acquired 1000Markets, an online community of marketplaces for niche products and artisan crafts, also based in Seattle. (See this blog post on the phase-out of 1000Markets.) Financial terms of the deal were not given.
The broader significance here is that social e-commerce is taking a big step forward. The field is starting to coalesce around a few ideas and models that have proven to be profitable—like Bonanza, which lets buyers and sellers interact, and makes money from transactions and premium subscriptions. Now the challenge is how to extend this model to a much bigger audience. The addition of 1000Markets should make an interesting complement to Bonanza’s business, adding variety in the types of goods offered as well as a new community of buyers and sellers. (The news also fits one of the themes I’m watching nationally, which is how Seattle startups could help reinvent e-commerce yet again, after Amazon.com.)
I first profiled Bonanza (then called Bonanzle) last year, when it was a small but fast-growing, bootstrapped operation. At the time, founder and CEO Bill Harding said Bonanza.com “was taken.” So one question is how much the company paid for the new domain name, and why it’s a significant change—presumably “Bonanza” is better because it’s an actual word, and it has connotations of shopping deals and wealth.
“With where we expect to be in a year or two, it will be drops in the bucket. And most importantly, given the data we have on how much difficulty people had with the old name, it will be money well spent,” says Harding, in an e-mail. “In retrospect this move is going to seem very obviously a huge step forward for us.”
In April, the startup said it had raised $1 million from angel investors including Geoff Entress, Andy Liu, and Kelly Smith, plus venture firms Voyager Capital, Ignition Partners, and Matrix Partners. 1000Markets, for its part, raised about $500,000 last year from True Ventures and Founders Fund.