Firstly, SW and V are not the two big marketplaces.  SW and Getmein, which is now owned by Ticketmaster are.

Secondly, Is Viagogo in it's current format viable or sustainable?

What it actually set out to do, have scores of brokers and fans list tickets on their and then take a considerable comission off them, hasn't actually worked.  Speak to any broker who has listed on there.  Sales are poor, most of them have actually left Viagogo and gone elsewhere.  They are miles behind GetMeIn and SW in actual broker and fan sales.

Of course they have more to their bow than this, but surely the 24/7 business that this generates for SW and GMI would have been their bread and butter when they were setting out?

The partnerships with sports teams and allowing their fans to trade unused tickets has been more succesful, particuarly with Manchested United.  But MU and the other sports teams,only let them trade tickets when the game has actually sold out - and the amount of games that MU sold out last season and therefore traded on Viagogo was significantly less than previous seasons and this trend is likely to continue. 

That leaves the other arm of their business and their deals directly with promoters.  They've been buying tickets up with contracts direcltly with event promoters for the last few years, for gigs like Prince, Madonna, Celine Dion and now Michael Jackson.  They've basically paid a premium for these tickets and flogged them to anybody who will listen, including ticket touts and brokers.  I suspect they took a hit on Celine Dion.

All that funding to basically tout their own tickets?  I don't think the other parts of the business have been successful, and the areas they have had success in are by no means guaranteed to continue.

For all the investment, sponsorship deals and attempts to become official partners with major promoters, Viagogo has failed to forge a brand.  I don't think it has any real considerable day to day business other than the partnership with Manchester United.  It doesn't have the scores of people on their selling tickets day in day out to make it an attractive proposition for somebody like ebay.

Seatwave I think has more chance of being a success, certainly in day to day business and the amount of tickets it is selling day in day out, it is a million miles ahead of Viagogo right now. 

Either way I don't see a sale to a promoter / ticket agent.  James will know more about this than I do, but there are murmers that Ticketmaster want rid of Getmein and that it has done their brand no good at all in terms of publicity.  Certainly the way they have started to let their sites fall off the radar and sales slow to a drip would support this.  If Ticketmaster do want rid of it, I can't see any promoter wanting to go down the same path when there are other ways of tapping into the secondary ticket market without the associated publicity and outcry.

Doesn't all this fundraising raise concern over the health of these businesses?

I have to assume these businesses are not profitable, otherwise why raise 4th rounds when it's such a terrible time for valuations and when both businesses haven't stated new significant initiatives with the new capital? Shouldn't growth already be "accelerated" after 3 rounds?

StubHub, who sold to eBay only raised somewhere allegedly in the range of $20 - $25M, to reach revenues of $600M. Quite a success story certainly.

But this however, well it has the aroma of something very different, something Ponzi-schemish: two businesses that have continue to inject capital to sustain the unsustainable.

Well judgement day is certainly coming, and it's coming for one of them sooner than the other. Easy to predict that Viagogo runs out of cash first, since they needed more cash sooner.

It seems the only obvious hope for both is they are bailed out by being purchased by eBay, since neither V nor SW seem willing or able to change course to grow organically. Growing organically would deflate their metrics dramatically and put them at risk of losing on any possible exit opportunity that might arise and is so desperately needed.

If eBay does indeed come to the rescue, they are going to have a field day with valuing these businesses - playing one against the other while comparing with their previous purchase of StubHub, a much much larger business acquired in an "up-market."

Are SW and V too big to fail? I would not be surprised to see a 5th round for one or both of these businesses next year.

We decided to raise cash to accelerate the growth of the business as we are now active with critical mass in 5 countries.  The fact that two venture-backed businesses have raised large amounts is just a testament to the quality of the market opportunity, not that we are playing tit-for-that.  Only one large winner is likely to emerge, hopefully Seatwave; being well capitalised is part of how you compete.

You are also in the middle of a market in evolution with the LiveNation / TicketMaster merger and related competitive positioning moves.  This should be a very interesting area to watch in the coming years as the traditional ticketing boundaries get blurred.

Note that what is interesting is to compare and contrast the approaches of the two businesses, which are quite different.  I will leave that a future post :-)