Groupon says "No thanks" to $5-$6 BILLION Offer

Wow, interesting read. It has to take some major stones to turn down an offer like that! Also, I can say I had no idea Groupon was netting that much coin, $500 mill, very impressive. Kind of similar to the Facebook $1 billion buyout offer, but 5-6 billion is another thing entirely, just crazy, and I can't say my knees wouldn't buckle and sell out int he same scenario.

 

http://blogs.wsj.com/deals/2010/12/03/shou...ell-out-or-not/

Jesus!

Whaaaat?!?

 

I'm sure some of the terms are a major factor in this decision but 5-6 billion is still 5-6 billion. If it were me, that shit would be SOLD!

 

I'd be a problem with a couple billion in my pocket... Lambo and all other exotic car companies would be good to go for years! Lol

Whaaaat?!?

 

I'm sure some of the terms are a major factor in this decision but 5-6 billion is still 5-6 billion. If it were me, that shit would be SOLD!

 

I'd be a problem with a couple billion in my pocket... Lambo and all other exotic car companies would be good to go for years! Lol

 

 

What would scare me is the thought of Google throwing those resources behind building a clone like concept which could eventually doom Groupon, just because Google is so much a part of everyones lives already.

I had never heard of this company before. I would pocket a few billion and enjoy life.

Take the money, with that kind of money it would be easy to start-up another idea after your non-compete expired. In the mean time get a life, the kid that started it looks like he needs one.

http://chicagobreakingbusiness.com/2010/12...ndependent.html

Thats a lot of everything!!

Money is just a tool, not the end goal. Most of these guys would probably blow their brains out if you took away their company and gave them a giant house, fleet of exotics, and yacht in exchange.

 

Groupon and Zynga have set the new standard for how fast you can grow a company past $1 billion in revenue profitably. (Groupons "pass through" revenues are actually estimated at $2 billion a year)

I think it was a smart business strategy. They are doing 500 mill a year in business. One smart thing Ive learned in business is to never undervalue your product and to turn down a huge offer like this from a huge company has generated a TON of interest for them. There talking about doing a IPO. Look at facebook and how much its valuation has raised over the last 4 years.

I guess time will tell.

I think it's a big gamble on future success. Many companies are one and done with their groupon promotion due to the logistics.

I guess, once you pass 100mil mark money is just a number.

Andrew Mason (CEO) along with other investors have already taken money off the table for selling a small %. Google don't have a great track record with several key purchases and many people would prefer not to be part of such a large organization.

Everyone told Zuckerberg to sell when he was offered a billion or whatever it was.

What would scare me is the thought of Google throwing those resources behind building a clone like concept which could eventually doom Groupon, just because Google is so much a part of everyones lives already.

 

Yeah given it (GroupOn) is only a 2 year old company and has reached such enormous size there is nothing stopping a bunch of teens at Stanford or another geeky university let alone engineers at a big company like Google taking the same model and tweaking it to be even better and stealing market share. There are hundreds of clones already including clones in markets GroupOn is not yet established in so I think it is fcuking stupid and arrogant to pass up such an offer.

 

Andrew Mason (CEO) along with other investors have already taken money off the table for selling a small %. Google don't have a great track record with several key purchases and many people would prefer not to be part of such a large organization.

 

Google have got a great track records with acquisitions. DoubleClick has become ubiquitous across the web, Youtube has reached records viewership and profitability and fended off challenges from records labels, Blogger is one of the largest platforms for blogs now,

Everyone told Zuckerberg to sell when he was offered a billion or whatever it was.

 

Facebook has a userbase nearing 1 billion and people are happy to stick with FB because they are able to connect with a greater number of friends on FB than any other site. Also to scale to the size of FB would require investments worth hundreds of millions in servers to provide huge bandwidth and processing power for the billions of photographs and live applications on the site.

 

On the other hand a quick wikipedia search tells us GroupOn has 200 clones after a mere 2 years and so far it has financed it's large salesforce and server requirements with capital raisings 1/10th of FB, all I can say is good luck to GroupOn they've got balls (and a lot of arrogance).

Facebook has a userbase nearing 1 billion and people are happy to stick with FB because they are able to connect with a greater number of friends on FB than any other site. Also to scale to the size of FB would require investments worth hundreds of millions in servers to provide huge bandwidth and processing power for the billions of photographs and live applications on the site.

 

On the other hand a quick wikipedia search tells us GroupOn has 200 clones after a mere 2 years and so far it has financed it's large salesforce and server requirements with capital raisings 1/10th of FB, all I can say is good luck to GroupOn they've got balls (and a lot of arrogance).

I would have taken the offer. Facebook has a giant network effect like M92 mentioned, GroupOn doesn't. There is a big difference between the companies.

I would have taken the offer. Facebook has a giant network effect like M92 mentioned, GroupOn doesn't. There is a big difference between the companies.

 

 

Exactly, Groupon is not international.

That is a big amount of money, nearly enough to make me happy but skim reading through I see no details of how that amount is constructed, ie lump of cash up front with a the remainder depending on performance of the site, when that is figured in with Google's acquisition success not being the most profitable it makes sense to play a little hardball.

what they are selling isn't unique, I would take the money and run, even if the company will be worth a lot more in the future 5 billion will bring you just as much happiness as 10 or 100 billion.

what they are selling isn't unique, I would take the money and run, even if the company will be worth a lot more in the future 5 billion will bring you just as much happiness as 10 or 100 billion.

 

 

exactly. no one can beat facebook no matter how hard they try since user base ain't going anywhere... they can make new better version of groupon in no time, google can put out new site and offer free $20-50 gift card when you sign up and boom everyone now going to that site.

Foolish. Google does not want the company, they want the data.

I agree with all you guys, sell and don't think twice. Make yourself and family billionaires and take care of your kids, grandkids, their grand kids, etc, etc. for life. Start a new business to tool around with in your spare time. Plus "Groupon by Google" has a nice ring to it.

Well then.........It's unanimous. Stupid turn down. You guys remember buy.com?

 

This is one of those times when being young and confident can be a detriment to making a good business decision. You only turn down a deal like that when your company is a global juggernaut and a household word/name. I've never even heard of groupon until this thread..As said earlier, it's not his company profits google wants, its the data that's worth 6 billion to them. Time will tell what happens with that company but from a personal standpoint you take the $6B and run...Going public doesn't guarantee Billions. These kids need to stop trying to be Sergey and Larry.

 

 

 

A lot of negative vibe here guys. I am no serial entrepreneur or millionaire/billionaire, but if this guy has been able to generate upwards of $500M of revenues in less than two years with his business, his thinking is probably that he can sustain a VERY strong rate of growth over the next 2-3 years with marginal risk to the going-forward of his business, and then substantially increase the value of his company in doing so, wether the conclusion of his partial ownership ends with IPO or a take-over by a larger corporation.

 

Another point to remember is that the article mentions he is likely to cash around $550M if the deal had happened...it tells me he owns roughly 10% of the company. Maybe the majority of other stake holders want to keep going longer than the founder wants.

^ yeah I got the impression the coin would be split up between different stake holders, and it's not just the founders decision to sell.

 

Would be very frustrating if the founder/s wanted to sell out and some new know it all wanted to stay.