FRAMINGHAM, 18 MARCH 2011 - Groupon is in talks with banks for an initial public offering that places the value of the company as high as $25 billion, Bloomberg and others are reporting.
If that occurs, the online daily deal provider would break the IPO record for venture-backed companies held by Google, Dow Jones said.
"If Groupon goes public with a valuation of $25 billion, it will be the largest IPO by a venture-backed company," Dow Jones VentureSource said in a news release. "Google's public offering, which had a valuation of $24.6 billion in 2004, is currently the largest venture-backed IPO in history."
Even if Groupon doesn't break Google's record, it seems likely to become only the fifth venture-backed company to achieve a $10 billion valuation at the time of its IPO, Dow Jones said. The others to crack that mark were Huatai Securities with a $16.4 billion valuation in 2010; Corvis with a $14.2 billion valuation in 2000; and Sinovel Wind Group with a $13.7 billion valuation in 2011.
Google has unsuccessfully tried to acquire Groupon, which offers "deal-of-the-day" coupons in cities and regions throughout the world. Groupon reportedly rejected Google's $6 billion bid, and now seems likely to adopt the same path taken by Google when it went public in 2004. Google is busy building its own coupon service to compete against Groupon.
Google's market capitalization is now $180 billion. Whether Groupon could ever reach such heights remains to be seen. While Groupon's value is based just on its highly popular and lucrative coupon service, Google has expanded far beyond its core focus of online search.
Just a couple months ago, the rumors on Groupon had the IPO valuation at only $15 billion, not $25 billion. It's not clear yet exactly when an IPO would take place, so we'll wait and see what happens.
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