Groupon goes IPO and raises $700 million or so after raising nearly that much privatly a year or so ago. In the meantime the company is going to lose about $200-$250 million this year and as of september it owes it customers more than it has in cash. So if I have the numbers right; roughly, they have about $250 million in cash and owe their clients around $400 million and sales around $1.2 billion.
Groupon works like this: You cut a deal with them to sell a coupon they sell it, hold the cash for a bit, as you provide the product/service (usually at a deep discout-as you have to bid against other businesslike offerings at discounts) then later the company pays you your cut of the coupon sale.
Sounds good if you can take the hit to cash, which might be minimal if you are filling an extra seat on a raft trip, or hotel room - so no fixed cost increase and minimal variable. But if you are providing a product it might be a bigger hit to cash and less of a winner. I guess it all depends upon a percent of the coupon clipper coming back coupled with the exposure they may provide your business. We shall see, and with the kinda numbers Groupon is dealing in we shall see sooner than later.
Bloomberg has a write up on the IPO here. And over at Techcrunch at least one writer is not impressed here.
If you have been caught in the economic downturn, that Groupon appears to thrive in, the folks at credit repair Texas are available to conduct a free evaluation to review your credit needs.
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