Friday, January 14, 2011

Groupon Now Valued at 15 Billion Dollars

By BRETT LIPTON Times Square Chronicles

Internet coupon new comer Groupon, is now slated to be worth $15,000,000,000, that is BILLION with a 'B'.

Rumors have been buzzing about Groupon recently, reporting that the online Coupon Deal Venue, headed by CEO Andrew Mason, may be planning to go public with an IPO in as early as Spring of 2011. If you are not familiar with, the new internet giant uses the following business model:

Vendor contacts Groupon with a deal, good for 1 day.

Vendor applies a minimum number of people that need to take the deal for everyone to be able to cash in on it ergo "Group"

Vendor makes a discount offer offer i.e. 20% off a purchase, $50.00 discount..., ergo "Coupon"

Result = GROUPON

If the minimum takers is reached: Deal On - for everyone!

If the minimum takers is not reached: Deal Off - for everyone!

Groupon was started a scant 3 years ago in 2008 and currently the Chicago based company houses approximately 120 employees. In this short time they have achieved an audience of approximately 15 million daily viewers to the site. According to internet website rankings by Quantcast, they are the 198th most trafficked site in the US. Amazon's Alexa ranks them at 87 in the US and 401st in the world. Interestingly, it is alleged that only a few months ago internet search and advertising giant Google offered them $6 billion only a couple of months ago, effectively almost tripling the value of Groupon in less than a year.

According to Groupon they just hit a online coupon milestone, saving their users over $1 Billion in shopping sprees. The site popularity and investment lure can be made quite apparent by summing it up this way: In August 2011 a single Groupon Gap deal offered its users $50.00 worth of shopping for $25.00 generated 445,000 takers and landed the company $11,000,000 in one take. The demand was so high that the deal was being taken at a rate of 534 per minute. As a result's servers suffered and the site experienced technical issues from the bandwidth draw.

Here’s Groupon CEO Andrew Mason, the “quirky personality” behind Groupon's group couponing, in an interview for Crain’s “40 Under 40: 2009.”

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