I read plenty of B2B Lead Generation blogs and the blogosphere is certainly abuzz with this story. Rumors are now circulating that Google has purchased Groupon.com for $2.5 billion over the weekend, but reports are still unconfirmed. Vator.tv broke the story, but said that it could not formally substantiate the deal, citing only a reliable source.
Benchmark Capital wrote a research report outlining the rumored deal. In their report, Benchmark writes:
"We view this move positively. While expensive, Groupon provides Google entry into the emerging daily deal segment. Groupon is local in nature, which could build on Google's positioning in the "long tail" with small and medium sized businesses. There are potential synergies with Google's core search.
"This acquisition would be similar to Google's YouTube and DoubleClick purchases in both size and strategy. Google is using its cash to buy into an emerging area of the Internet, thus maintaining its relevance in new segments. Since YouTube and DoubleClick are both gaining share and posting sizable revenue numbers, we think Google's acquisition history has been solid."
Here's an observation that this blogger sees: Google acquired Youtube in 2006 for $1.65B. Even then, Youtube hadn't realized it's full revenue-earning potential. Google was acquiring synergy. For Groupon, Google is spending nearly $1B more and for what? In addition to buying perceived synergy, they are buying a revenue stream reported to be nearly $50 million PER MONTH.
I wonder if Groupon offered a discount after the deal was "tipped."