Groupon spurns Google; IPO could exceed $15 billion

Variation on the Groupon logo.

Groupon may achieve the highest IPO valuation of a company to date. (Photo Credit: CC BY-ND/Justin/Single Dad Surviving)

Local business marketing and consumer coupon company Groupon is a rising star in the online retail community. The company has done so well that in November Google offered to buy Groupon for nearly $6 billion. But as the New York Times reports, Google doesn’t always get what it wants. Groupon will soon move forward with an initial public offering that could value the company at more than $15 billion.

Groupon raised $950 million from investors

Groupon’s funding push, which brought in $950 million from investors, included money from large investors such as Fidelity Investments, T. Rowe Price and Morgan Stanley. In anticipation of going public, Groupon met with banking representatives this week, anonymous sources close to the potential $15 billion-plus deal told Read Write Web. Over the past year, Groupon has expanded to 35 countries, gotten into 500 new markets (up from 30 in 2009), expanded its subscriber base by 2,500 percent. In 2010, approximately 60,000 businesses marketed their products and services to the public via Groupon’s coupon system.

Annual revenue at Groupon reportedly exceeds $1 billion. The company has more than 50 million users worldwide and a staff of 3,100.

Groupon CEO Andrew Mason has seen company’s value skyrocket

While nothing is official until Groupon’s IPO, company CEO Andrew Mason sees a Groupon stock value that’s out of sight. If Groupon does manage a $15 billion-plus IPO, it would be the highest initial valuation of a company to date, exceeding even Google’s 2004 IPO. With new Chief Financial Officer Jason Child (a 12-year veteran of Amazon’s international business arm) in place at Groupon, the ship appears to be in good hands.

Morgan Stanley and the IPO inside track

Financial experts believe that Morgan Stanley’s involvement in a potential Groupon IPO would give the company the inside track it needs to go public. Greg Sterling, analyst and founder of Sterling Market Intelligence, told the Times that Morgan Stanley’s sizable reputation on Wall Street should play a huge role in Groupon’s future.

Web startups raising major cash

Groupon’s $950 million from investors headlines what the Times calls a “particularly frenzied” time for Web startups. Twitter raised $200 million recently, and the company is valued at $3.7 billion. Career networking platform LinkedIn appears to be headed for its own IPO this year, according to insiders. Even Facebook appears to be on its way to an IPO in 2012 – reluctantly, claim reports – after a $450 million investment from Goldman Sachs.

Sources

New York Times

Read Write Web

Groupon mobile app review

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