Groupon took its first step to take the hot daily-deals company public today and is looking to raise $750 million, according to filings with the Security and Exchange Commission.
The red-hot startup, which spurned a $6 billion buyout bid from Google last year, made $644 million in revenue during the first quarter, but lost $117 million in operating expenses. Revenue is growing at a steady clip, however, up from $44 million from the year-prior period.
|Groupon's Growth in 21 Months|
June 30, 2009
March 30, 2011
|Quarterly Revenue||$3.3 million||$644.7 million|
|Markets||5 in North America||175 in North America & 43 countries|
|Subscriber Base||152,203||83.1 million|
|Number of Merchants||212||56,781|
|Groupons Sold||116,231||28.1 million|
|*All according to Groupon SEC filing from June 2011.|
Groupon is largely responsible for creating the daily-deals category, which has spawned has an endless list of copycats. Beyond startup deal competitors, everyone from Google and Amazon to newspapers and media companies have launched their own daily-deal clones to get at the billions in potential revenue in selling cut-rate deals on behalf of local merchants. For a category that hardly existed just three years ago, BAI/Kelsey Group estimates the deals market will reach $3.9 billion by 2015.
While Groupon has struck upon a model designed to rake in money -- on every deal sold, Groupon gets roughly half of revenue from goods or services on which local merchants accrue expenses -- it's a business highly reliant on people. The company supports large sales forces rather than the self-serve technology other hot technology companies like Facebook employ. To compare, Facebook had fewer than 100 employees at its two-year mark and today still has only 2,000. At 30 months old, Groupon has more than 7,000 employees, which is up from more than 5,000 in just March.
Founded in Chicago, Groupon has expanded across the world, sending email deals to 83 million subscribers in 43 countries.
As expected, Groupon is just the latest in a red-hot IPO climate. Groupon's filing follows LinkedIn's IPO last month and precedes an expected filing from social-gaming juggernaut Zynga later this year.