It All Started with Swoopo – A Brief History of Penny Auctions

Swoopo.comPerhaps you’re new to bidding on DealDash.com and wonder where this pay for a chance to bid concept came about. While, it didnt start with DealDash, DealDash did start in the early days of online auctions and enterainment shopping.

The fascinating online auction concept all started with a German company called Telebid. Telebid originated in Germany and began as a series of advertisements on TV with items that could be “bid” on by calling in on the phone line. Then it progressed and expanded to the Internet with Swoopo.com in 2008.  From 2008-2010 Swoopo grew exponentiall and opened to bidders worldwide with the same site open to offer the bidding experience to many countries and languages. It grew so large that the items would get bigger and better with auctions for brand new cars and a trip-around-the-world. The creators of entertainment shopping raised over $10,000,000 in funding in 2009 by August Capital in Silicon Valley, with earlier funding in 2006 from Wellington Partners.In 2010 Swoopo was named to the new  TechCrunch Europe Top 100 Index list of the most innovative and “highest-potential” European tech companies.

On the heels of Swoopo’s great success, people took notice and aspiring startup founders set up shop and some even set up software companies just to sell “Swoopo-clone” software to anyone wishing to get into the space and make it big. See, the way Swoopo worked, and why it gets its name as the very first online auction site is that auctions for desirable items, even trips and new cars, were sold on a rolling 24-hour basis with items being offered to consumers with a chance to win items at a discount, sometimes as much as 99% off (though traffic didn’t make it all that easy for bidders to win items at this great a discount, it did happen.). For many then-online auction site owners, the concept was nothing more than a pipe dream. Some turned a profit, others lost tons of money. Others even outright stole from bidders and hundreds of examples of this can be found on the industry authority site PennyAuctionWatch.com. The problem was the ability to cheat bidders out of money with fake bidding bot software programs, and anyone who had a little bit of seed money and time to set up a online auction could easily buy clone software, throw up pictures of a few items, advertise and then rake in earnings from bid packs sold to bidders who had high hopes of winning items that were nothing more than pictures on a screen.

There were good sites and there were bad sites. A few bidders even got in on the action and made a sizable income (some made around $100,000 a year just bidding and reselling items on sites like eBay and Craigslist.) More power to them really, but what happened was these bidders were in it to win and resell so they made it more difficult for the regular joe-bidder to come in and win at a discount, at least on the items they were dead set on winning.

After Swoopo came many other sites, hundreds of which have now come and gone. Swoopo tried to find more ways to provide a better bidding experience, but often came under fire by critics as being  deemed online gambling, as being questioned for the ability to offer the same auctions across multiple websites and countries. Later they added buy-it-now which allowed bidders to purchase items at a discount. In March of 2011, Swoopo shut down for good, citing technical difficulties when they were really in the process of filing bankruptcy in Germany. Later on in 2012, DealDash acquired the Swoopo.com URL,so when you go to the website now you will be redirected to DealDash.com.

DealDash originally launched as BidRay and was live in early 2009, BidRay,originally with offices in Sunnyvale,CA, with headquarters in Helsinki, Finland and has grown significantly since its launch and is one of the longest-running and few standing entertainment auction sites open today. In the early days BidRay offered items like nostalgic candy gift boxes, popcorn machines, gift cards, cosmetics, packs of gum, Apple products, and HDTVs.

Have you been around since the early days of Swoopo and BidRay? We want to hear from you!

Let us know if you bid on Dealdash and the reasons you still bid!

 

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