Overview

Product Description

Auctionata | Paddle8 was an online auction platform specializing in art and luxury collectibles. The company was the inventor of the livestream auction.

Quick Stats

2012

Started in

Feb, 2017

Closed in

201-500

Employee (s)

$92,000,000

Total Raised

Why did Auctionata fail?

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Evan Lee

Updated on 15 Aug, 2017

Legal Challenges

Poor Product

Auctionata was a popular online auction platform that first developed the livestream auction. The company raised over $150M in funding and seemed full of promise after purchasing competitor Paddle8.&nbsp;However, Auctionata was undone after international accounting firm KPMG <a href="https://news.artnet.com/market/audit-auctionata-trade-violations-464057 target=" _blank"=""><a href="https://news.artnet.com/market/audit-auctionata-trade-violations-464057">uncovered</a></a> allegations of serious trade violations. KPMG reported that Auctionata's CEO Alexander Zacke participated in "shill bidding", which is a tactic used by fraudulent online auction sellers to artificially increase sale prices. In essence, Zacke would make fake accounts on Auctionata and bid on items in order to drive the price higher.Months later, reports of business difficulties at Auctionata emerged after independent evaluations of auction results suggested that the house was making only very few direct sales.&nbsp;Auctionata also <a href="http://blog.thefineartblog.com/2016/05/auctionata-paddle8-merge-despite.html#axzz4obZ3rPt4 target=" _blank"=""><a href="http://blog.thefineartblog.com/2016/05/auctionata-paddle8-merge-despite.html#axzz4obZ3rPt4">allegedly</a></a> released financial reports and press releases that would "mysteriously erase all unsold lots which account for at least half of all lots offered". In essence, Auctionata's murky financials and allegations of shill bidding and selling fake art led to a massive decline in sales.&nbsp;Zacke left the company in October 2016 and was replaced by former Bertelsmann executive Hesse, who was ultimately not able to save the company despite extensive restructuring.

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Investors - 15

Funding Rounds - 4

Seed - $3,000,000

Series A - $17,000,000

Series B - $30,000,000

Series C - $42,000,000

Founders

Susanne Zacke

Georg Untersalmberger

Alexander Zacke

Alexander Gilkes

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Evan Lee

Auctionata

2012

Started in

Feb, 2017

Closed in

201-500

Employee (s)

$92,000,000

Total Raised

Why did Auctionata fail?

Evan Lee

Updated on 15 Aug, 2017

Bright Capital

Earlybird Venture Capital

e.ventures

German Startups Group

GP Bullhound

Groupe Arnault

Hearst Ventures

HV Holtzbrinck Ventures

Kite Ventures

Kreos Capital

MCI Capital SA

Raffay Group

RI Digital Ventures

TA Ventures

Yuan Capital

Seed - $3,000,000

Bright Capital

Kite Ventures

RI Digital Ventures

e.ventures

Series A - $17,000,000

Bright Capital

Earlybird Venture Capital

HV Holtzbrinck Ventures

Kite Ventures

TA Ventures

e.ventures

Series B - $30,000,000

Earlybird Venture Capital

HV Holtzbrinck Ventures

Kite Ventures

e.ventures

Series C - $42,000,000

Bright Capital

Earlybird Venture Capital

GP Bullhound

Groupe Arnault

HV Holtzbrinck Ventures

Hearst Ventures

Kite Ventures

Kreos Capital

MCI Capital SA

Raffay Group

TA Ventures

Yuan Capital

e.ventures