Groupon Acquires Pelago; Shuts down Whrrl

Today group buying giant Groupon acquired LBS start-up Pelago, the developer of Whrrl, a not so sucessful location-based service that attracted more VCs ($22.4 million raised)than users (“many hundreds of thousands of customers“).

It is therefore interesting to see this acquisition happening. In this case Groupon is clearly acquiring a team (20 to 30 people) with expertise in LBS rather than anything else. As a matter of fact, the Whrrl service wil be shut down on April 30th, 2011.

Jeff Holden, former CEO of Pelago will be overseeing Groupon product development.

Terms of the deal were undisclosed, but we do not believe Pelago’s investors are making any profit from this sale, rather minimizing their loss.

Now it will be interesting to see what location-triggered product will be launched by Groupon in the near future.