This article contains information about Groupon (GRPN).
Groupon is the latest and the hottest IPO that will be priced tonight and start trading tomorrow on NASDAQ under the ticker symbol GRPN.
There appears to be heavy demand for the IPO. According to some reports, the company will be priced $1 to $2 above the present $16 to $18 price range. At a stock price of $20.00, Groupon will be worth $12.7 billion.
Groupon is a deal-of-the-day company that offers discounted certificates on items such as travel, restaurants, and day spas. The business model of the company is to keep about half of the amount that it receives from the customers and the rest goes to the merchant.
Groupon faces heavy competition. Living Social is the nearest big competitor. According to some reports Amazon.com (AMZN) has now become the number-three in this business segment. Google (GOOG) is also targeting this business. It was reported in 2010 that Google offered $6 billion for Groupon but the offer was turned down.
To get the high valuation that Groupon is receiving, Groupon is disguised as a technology company. If the truth be known, Groupon is nothing like any technology company that we have known. Groupon is a sales and marketing company that has latched on to a fad and disguises itself as a technology company to get high stock market valuation.
Groupon has more than 10,000 employees, but only 5% are in technology. It appears that most of the technology employees are simply supporting the infrastructure and not developing technology. Most telling is Groupon’s financial statements. It appears..Read More at Forbes…
