Ready for a daily deal? This one may cost a lot. Groupon announced it has filed with the Securities and Exchange Commission (SEC) to go public in hopes of raising $750M in an IPO. Groupon’s IPO is underwritten by its own group of investors in Morgan Stanley, Credit Suisse and Goldman Sachs.
Few companies have skyrocketed in growth as much as Groupon, which grew 23 fold from 2009, with company revenue totaling $713M for 2010. For the first quarter of 2011 alone, revenue was $644M.
The company had 83 million e-mail subscribers to its deal-based newsletter at the end of Q1, rising from 50 million for all of 2010. The firm also raised more than $1B in venture capital, but is not actually profitable in its current state.
“We have incurred net losses since inception and we expect our operating expenses to increase significantly in the foreseeable future,” Groupon wrote in a statement. “We incurred net losses of $389.6 million and $102.7 million in 2010 and the first quarter of 2011.”
The filing was expected, and was likely accelerated by the boon of companies such as LinkedIn going public, which doubled it’s share price in the first day of trading. Groupon plans to trade under the symbol GRPN once the first shares go on sale.
“If you’re thinking about investing, hopefully it’s because, like me, you believe that Groupon is better positioned than any company in history to reshape local commerce,” wrote Groupon founder and CEO Andrew Mason in a letter to shareholders. “The speed of our growth reflects the enormous opportunity before us to create a more efficient local marketplace. As with any business in a 30-month-old industry, the path to success will have twists and turns, moments of brilliance and other moments of sheer stupidity.”
Regardless of current losses, growth such as that seen in Groupon suggests that the company will be profitable soon and should be a “good deal” for investors.
