To stay ahead of the group-buying fray, Groupon has reportedly held talks with several banks about an IPO valuing the company at a jaw-dropping $25 billion. Just 2-years-old, Groupon's IPO
could happen this year, and is very unlikely to fetch under $15 billion, reports Bloomberg Businessweek, citing sources. "To give some perspective, Google was valued at $23 billion in its IPO, so that would make it a bigger IPO valuation than Google,"
notes Business Insider.
In the context of other hot, privately-held Web companies, The Wall Street Journal writes: "Unlike dot-com companies a decade ago ... the new crop
of Web companies have attracted a large base of users and are generating revenue through online advertising and other means." Industry experts, however, express serious skepticism about the
long-term prospects of group buying. Groupon and its kin are "being valued as though they are going to be the next Google or EBay or Amazon," Claire Enders, head of media consulting firm
Enders Analysis, tells Bloomberg Businessweek. "But their business models may reach their limits a lot more quickly, or not work in as many markets."
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Under the headline,
"Is it a Tech Bubble Now? Groupon Talks $25 Billion Valuation," Deal Journal writes: "We know, we know. It's different this time around. But it sure feels like tech manic 1999 all over again." "To provide a few points of
comparison: the current market caps of AOL, IAC, Netflix, and Yahoo are $2.0 billion, $2.6 billion, $11.3 billion, and $20.8 billion, respectively," writes WebProNews. "So Groupon's definitely setting its sights high." "Honestly, I don't get
it," Marketing Pilgrim writes of Groupon's potential
valuation. "What's either going on here is that Groupon is even bigger than most of us can grasp or this is simply the most incredible spin job in the history of
business."
Read the whole story at Bloomberg »