Groupon hopes to raise up to $950 million
Groupon Inc., which recently turned down a takeover bid from Google rumored to be as high as $6 billion, is out to raise money on its own in a big way.
The online coupon company’s board has authorized it to raise up to $950 million, according to a report from the website VCExperts.com. That would be the largest round of equity financing since Pixar sought about $500 million in 1995.
A Groupon spokeswoman declined to comment, but Andrew Mason, the company’s founder and chief executive, wrote in a Tuesday evening Twitter message, “Groupon is in the process of completing a new round of financing — we’ll let everyone know when there’s more to announce.”
According to estimates from VCExperts, the new round of financing would make the privately held Groupon worth about $6.4 billion.
Currently, Groupon operates in 35 countries, with more than 3,000 employees and an expected annual revenue of $500 million this year. The company is said to have turned its first profit after just seven months in business.
Its backers include Chicago-based investors Eric Lefkofsky and Brad Keywell, the venture capital firms New Enterprise Associates and Accel Partners, and the Russian firm Mail.ru Group, which was formerly named Digital Sky Technologies.
Groupon makes its money by taking a 50% cut of each discount coupon it sells through its website.