Groupon IPO Could Be Valued At Close To $25 Billion

NEW YORK (Reuters) - Daily deals website Groupon could be valued at as much as $25 billion in an initial public offering, Bloomberg reported on Thursday, citing two people with knowledge of the company's discussions with banks.

The offering may happen this year and would likely value Groupon at a minimum of $15 billion, the sources told Bloomberg.
Groupon did not immediately respond to requests for comment on the report.

Groupon founder and Chief Executive Andrew Mason told Reuters in January that the company was considering a public offering and was in talks with bankers, but had had yet made a decision about whether to proceed.

A source told Reuters in January that a Groupon offering would be "meaningfully sized."

The two-year-old start-up rebuffed a $6 billion advance from Google Inc (GOOG.O: Quote, Profile, Research, Stock Buzz) late last year, according to media reports. Over the course of 2010 it grew to 50 million users, from 3 million, in 500 cities in 40 countries.
(Reporting by Maria Aspan; editing by John Wallace)

Copyright 2011 Thomson Reuters. Click for Restrictions.

Comments

[Dan Kushner]

12:21 PM on 03/26/2011

This was before the reported 30% drop in revenue. Also, if you talk to the IT and Ops people at Groupon, they are sick of setting up salons.

[mistercrispyusa]

10:55 PM on 03/18/2011

I predict Groupon is going to be the bullseye in the next Dot Com Bubble Bust. Unless Groupon finds a way to branch out beyond the present business model, they will implode upon themselves.

[LuLou Murder]

02:03 PM on 03/18/2011

Once the novelty of Groupon wears off, and businesses begin to realize what a poor deal it is for them, you could buy the company for $25. Not a share, the whole company.

[exilist]

03:44 AM on 03/18/2011

$25B??? Trying to stop laughing

[Dagmawe Girma]

02:10 AM on 03/18/2011

I will sooooo short this stock if it ever goes public.

[valkyre]

12:26 AM on 03/18/2011

HAHAHAHAHAHA

[laborgrunt]

10:44 PM on 03/17/2011

Dot.com bubble 2.0!

[ChaCubed]

05:29 PM on 03/17/2011

With all the free advertising Groupon is receiving from the media, it should be worth 4 times that.

Personally, as long as they are using those horrendous "behind the open screen" pop-up-ads, I won't even click on their website.

[peztopia]

03:53 PM on 03/17/2011

Pets.com

[JackHoffman]

02:49 PM on 03/17/2011

I wonder if we'll get a 'Daily Deal' on their stock?

[CountryBeforeParty]

02:45 PM on 03/17/2011

I love GroupOn. Been using it since right after it came out almost two years ago. Found it by accident.

But come on.... $25 billion? That's a lot of money and I think it's highly unlikely.

You know how big that is? You could give that $25 billion to the State of Texas and you STILL wouldn't balance their budget! =)

[frank day]

02:24 PM on 03/17/2011

Didn't anyone learn anything from the dotcom bubble?

[Johann Q]

02:39 PM on 03/17/2011

This time, it's different: Different to the situation in the late 90s, the bright tech stars of the day, actually turn a decent profit already. One thing, however, will turn out the same: These companies will, rather sooner then later, shrink back to normal valuations soon.

Groupon will certainly not maintain their current margins, probably not even maintain their profits and it's also quite likely that sales growth will mainly come from international markets soon.

[Dennis Santiago]

02:00 PM on 03/17/2011

I really don't get this one. I looked at the model and I think it has such a short burn out fuse. The Groupon differentiation model depends "as their site material says" on word of mouth buzz causing primarily young women in their twenties to react to their emailing offers inside of a specified campaign response window. You can only play that game so long before the supernormal activation effect saturates even with the core target group. The business utility is of course of far less marketing value for less susceptible consumer segments.

[leorangerie]

01:33 PM on 03/17/2011

This one smells like the sort of overheated deal that investors may regret in the fullness of time...but of course by then the smart money would be long, long gone. Not enough that's proprietary to make a long-termer.

[Anthony Garnett]

01:48 PM on 03/17/2011

$25 billion that is such an over reach

[EinChicago]

01:27 PM on 03/17/2011

Unless they lose the Ferria lawsuit in CA, in which case it will not be worth $15.00 because it's business model will have been effectively declared illegal.