Google has offered Groupon $5.3 billion, with the promise of $700 million in performance bonuses for management.It is unclear to me why Google is so interested in this company, so much so that it is willing to pay nearly twice what it paid for DoubleClick.
It could ... give Google access to a large sales force ... Groupon has 3,100 employees ... [and] 35 million [Groupon] subscribers worldwide, with 17 million in North America.
11 months [ago] ... Groupon ... [had only] 200 employees ... [Now] about 1,000 people work in the Chicago office and some 2,000 more are spread across its sprawling worldwide network, which includes the employees of its recent international acquisitions, ClanDescuento and Citydeal.de — group-buying sites in Chile and Germany. According to Groupon, the company is adding more than 200 employees a month.
Google helps people find information. It's mission is "to organize the world's information and make it universally accessible and useful." In advertising, Google helps people find millions of interesting small businesses and sort through billions of products to get what they need.
Groupon is very different. Groupon runs one deal per day per market. There is no technology at Groupon, no information finding, no long tail, no massive data stream. What there is is a large (but very recently hired) sales force, significant revenue, and a decent subscriber base. Those are the kinds of things that looks good to MBAs building spreadsheets and empires, but are not deeply aligned with Google's mission of organizing information and making it useful.
It looks like this is a done deal at this point. But Groupon is not Googly. I fear these cultures are not going to blend well when mashed together. I wish these two luck, but this looks to be more like the kind of union where the bride walks away with the house and the dog in a few years than one where both sides thrive.
Update: It appears it was not a done deal after all.