Groupon Raises a Billion Without Batting an Eye


Google certainly didn’t do itself any favors by offering a-deal-a-day site Groupon an overinflated $6 billion to buy the company. Rejecting Google’s offer, however, sure did wonders for Groupon. Rumors first emerged late December that the popular website was looking to raise $950 million at a $4.75 billion valuation, and voila, less than two weeks later, it has — and from some very big-name investors, including Andreessen Horowitz, a venture-capital firm run by Netscape co-founder Marc Andreessen, and Kleiner Perkins Caufield & Byers, led by John Doerr’s reawakended zeal for hot tech properties, regardless of whether their valuations are justified.

$4.75 billion is a big jump from Groupon’s $1 billion valuation when the company raised $135 million last April, especially considering its clones and competitors, like Amazon’s LivingSocial, have only increased. Plus, it’s not as though Google will bow out of social buying. Despite valuable data on shopping preferences for its 35 million subscribers, right now Groupon has a growing lead in the market, not a monopoly or a secret sauce. (Even the formula for its winsome copy — like today’s press release titled “Groupon Raises, Like, A Billion Dollars” — is public. But playing hard to get never hurt anyone’s value. After Google’s $6 billion offer, maybe $4.75 billion suddenly looked reasonable.

Done! Groupon Closes Out Nearly Billion-Dollar Round [eMoney/AllThingsD]
Groupon Raises, Like, A Billion Dollars [TechCrunch]
Related: Is Google’s Paying $6 Billion for Groupon Another Sign That the Tech Bubble Commeth?