Groupon Rejects Google's $6B Offer.

My gut instinct is that this deal was never on the table. The rational minds at Google would have to be high on something really strong to even consider Groupon worth $6B. (If so, please share, people!). My cynical thinking is that these were rumors spread by people interested in seeing Groupon go public; the $6B from Google rumor makes for a nice, fat initial offering price.<p>Groupon has zero barrier to entry and zero technology. Unless they have a strong IP portfolio (which they don't appear to be, given the number of competitors that have sprung up), I don't see the value here, other than brand name.<p>I was given a Groupon for a local specialty chocolate vendor recently, so I decided to chat her up to see what she felt about it. She had tried Groupon, Townhog and a couple of others. She shrugged and said that she wasn't sure if she was going to try these again; but if she did, she'd use Townhog. It was clear that there was no barrier for her to switch. Why should merchants give Groupon 50% of the face value of coupon, if their competitor will do the same for 25%? And the next one at 10%?

Keep in mind that the $2B estimate is the run-rate meaning the current period's sale (Quarter or Month) multiplied to estimate the entire year's rate if the same rate continues.<p>Their current period's revenue is extremely high due to this season (with the year ending) carries high demand from businesses to make more $.<p>Realistically they are said to have an estimated revenue of around $850M so with their 50% cuts, take in $425M and after wages, expense and taxes, they are probably profiting somewhere around $100-150M

Probably a wise move if you're making $0.5 billion/year 2 years after inception. They should be careful though, they don't have the kind of lock-in that many big Internet companies do. You could easily compete with them.

If they are pulling in $2billion a year as the stories are saying, $6B is nearly chump change. Plus it keeps the humans involved in Groupon rather than Google trying to replace it with algorithms.

$2 Billion/year for a niche advertising company <i>sounds</i> a bit implausible.<p>Anyone have any concrete verification of this?

I can't say much about the $6B but I can see why the Groupon sales team along with their relationships with local businesses is valuable to Google.

If there really was an offer then I think it's the biggest mistake Groupon's founders ever made.

Why not link to the original source <a href="http://chicagobreakingbusiness.com/2010/12/sources-groupon-rejects-googles-offer-will-stay-independent.html" rel="nofollow">http://chicagobreakingbusiness.com/2010/12/sources-groupon-r...</a> instead of a content mill like Mashable.