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JAFCO invests $5.3m in group buying site Luxa

  • Andrew Woodman
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JAFCO has invested JPY500 million ($5.3 million) in Luxa, a Japanese group buying site, as part of a Series B round.

According to Techcrunch, the Japan-focused VC investor committed the same amount to the company in November 2010. This brings Luxa's total funding to around $10.6 million since operations started in August 2010.

Unlike other daily deal sites, like Groupon, Luxa targets a higher-income demographic by listing only premium items such as branded cosmetics and meals at up-market restaurants. The company claims to have around 350,000 members in Japan. Headquartered in Tokyo, Luxa also has offices in Osaka, Nagoya and Fukuoka.

Swimmy Minami, CEO and founder of Luxa, also started BizReach.jp, a job site which offers premium listings for those who earn more than $70,000 a year. JAFCO invested $2.6 million in BizReach back in March 2010.

While Luxa may be on to something with its niche premium strategy, previous venture capital investments in Asian group buying sites have not all ended happily. China saw a flood of Groupon copycats emerge from 2010 but many have sinec gone out of business due to intense competition and near-zero profit margins.

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