

Why Groupon Needs $950 Million More - atularora
http://www.pmorganbrown.com/2010/12/why-groupon-needs-950-million-more/

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ghshephard
Unless Google put significant earn-outs in the acquisition (possible) - was
there any real downside to Groupon accepting an offer that they knew was bound
to fail? It's not as though a failed $6B acquisition would really have
negatively impacted GOOG's $190B market cap, so, even it had been a stock deal
- they could have taken the money and run.

I think the better answer is that (A) The Groupon guys thought they were worth
more than $6B, and (B) they wanted to keep running their own show and find
their place in the sun.

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sp4rki
Touche. I was having this discussion with a coworker the other day and I was
saying sort of the same thing. People think it was unwise to refuse Google's
offer, but Google's culture and track record regarding what need's to be done
to make Groupon big make selling to Google the wrong decision. If they had
accepted Groupon would have undoubtedly died a gruesome death or end up merged
into a subdivision of Adwords quietly collecting dust.

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Tichy
I don't get it - how is Groupon supposed to scale? What would be the point of
them having 100000 small businesses in a city? They could hardly put them all
on their homepage? Also, they would need enough visitors to their homepage to
drive business to all their clients.

What does Groupon offer, besides traffic (ie people who visit the Groupon
homepage)? Can't small businesses just make up their own special offers? I
mean if they are not on the front page of Groupon, they would gain little by
going through Groupon, or so it seems to me.

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phpnode
You're thinking short term, Groupon just needs to get to the stage where
people think "I'll just check Groupon to see if I can get this cheaper" before
every purchase. Then there's a million things they could do to take advantage
of that visitor's purchasing intent, local price comparison for example

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Tichy
None of these things are exclusive to Groupon, though. There are already lots
of aggregators for coupons where you can check if you can get something
cheaper.

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lfittl
The point is that these aggregators are not in everyone's mind today. Groupon
can use their current offering to reach everyone's mind, and then use that
positioning (and therefore you going to their site) to do price comparison,
focus on the user choosing specific topics of interest, etc.

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ra
Yes but the counterpoint is that it's an easy-to-replicate idea

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pygy_
Having a large mindshare in a specific niche is neither an idea nor is it easy
to replicate.

