It comes after online retailer Catch of the Day launched a similar site last month. Both concepts are similar to that offered by a successful US site Groupn, which has achieved success by offering a different type of discount every day.
Allen and Nextec Capital are the key investors in Jump On It, but Allen says the overall market for venture capital sector remains fairly weak, with angel investors taking the lead.
"I wouldn't say there is a lot going on, but there is still stuff happening more at the individual level rather than through funds and such. There has been a shortage for awhile, and I think the current market reflects that, but the better companies are getting funding.
Allen says when looking for investment targets he considers the propensity for the business to generate revenue quickly and the competence of the management team – two factors he considered when looking at the new site.
"It's a combination of the market opportunity, the business model and the likelihood customers are going to take it up. You see a lot of technology around that looks good, but is slow to build up revenue and takes a long time to sell."
He says he has noticed a number of companies with sales cycles that are "very long... with sometimes years going by before products go to market".
"With a start up you are obviously losing money. Everyone also overestimates market demand, you think the world is waiting for your product or service. I look at that potential very hard, and also the management team very hard."
While Allen says he isn't actively searching for investment opportunities, he says he will be making another within the next few weeks, "so I've got my plate full... if I see an opportunity that meets my requirements, then I'll typically invest."
Chief executive of Jump On It, Colin Fabig, says Allen was attracted to the coupon-based model which has already achieved significant popularity in the US.
"Roger Allen and his team have seen Groupon overseas, and have in fact invested in Groupon in a small way. There is obviously potential here, he likes the model and wants to get involved."
"The concept is a win/win for all parties, where they get information about all offers and it's provided in a very simple way. It's aimed at women in their 20s to 40s who have disposable income, going to restaurants, the theatre, etc. These people will have done those things anyway, so it's good for them."
The site works by connecting with advertisers. The advertiser, usually some type of experience-based offering such as a restaurant, theatre show or museum – provides advertising for free along with a substantial group discount.
Users then log on to the site and sign up to buy the group discount. However, the discount coupons will only be sold if all coupons within the one discount package sold. If the site offers 30 discounted entry passes to a movie, for instance, the discount will only leave the site once all 30 have been sold in a group.
Each discount will be replaced with a new product each day. Fabig says this concept has already taken off with retail products, and there is no reason why new sites emulating Groupon can't do well in Australia.
"We saw this concept in October last year, and we put a team in December to get things up and running. We've started developing the product, the site will launch in three weeks and we're going well."
As for Catch of the Day's Scoopon site, Fabig says competition is good for the market and he intends to take as much of the market as possible before the US-based Groupon inevitably moves into local territory.
"I think it's great there is competition. This is a new industry segment, there have been reports the daily-deals based offerings are worth billions each year. We want to go hard and make this thing work, and we've put together a great team to do so."
A number of brands have already joined Jump On It including Sheraton and Guzman y Gomez.
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