Blog Post

SEC Watch: Groupon Raises Half A Billion In Half A Round

Some investors in local deals startup Groupon won’t have to wait for a sale or IPO to get a payout. In an SEC filing Thursday, the Chicago-based company said it has raised $500 million and held open the possibility of raising another $450 million, with nearly $345 million slated to buy back equity from current shareholders.

Those eligible to sell include founder and CEO Andrew Mason, Eric Lekofsky, and board members Ted Leonsis, Brad Keywell, John Walter, Jason Fried, Peter Barris, Harry Weller and Kevin Efrusy. That will give the individual and institutional investors some return despite the decision to reject an offer from Google (NSDQ: GOOG) reported to be in the range of $5 billion to $6 billion.

Put another way, the $950 million Groupon says it could raise in this seventh round of founding is just over the number of dollars the company currently boasts on its site of saving users: $929,684,459 on 21 million-plus transactions. It’s also many times over the $135 million round raised earlier this year from Russian investor DST. It the full round is raised, Groupon will be well past the $1 billion mark. It already has 33 investors; the current round hasn’t been identified yet.

It also has global expansion plans and a growing number of competitors. Groupon didn’t disclose a revenue range in the filing but, citing unidentified sources “close to the situation,” Kara Swisher earlier this month reported that the company was headed for $2 billion in revenue this year. That’s not all Groupon’s to keep; roughly half goes to the merchants.

Update: I should have included this earlier. TechCrunch reports that the round was led by DST with Fidelity and Morgan Stanley at a valuation of $4.75 billion.

One Response to “SEC Watch: Groupon Raises Half A Billion In Half A Round”

  1. roryrobert

    Great to hear this good news from Groupon. With giants like Google and Amazon joining this game, money is very important for them to maintain their current market leader status. However, one of the problems Groupon facing is that it’s the products or services that the buyer cares the most. With the increasing number of deals offered, buyers can just visit a daily deal aggregator like to check all the available deals easily. As a user, it makes absolutely no difference to me if I get an email from Groupon, LivingSocial, or ShopWay telling me about a deal, since I’m after the deal itself. With all of these clones coming up, Groupon’s model runs the risk of becoming a commodity.