![]() ![]() The market was less than ideal and the press was far from glowing, but the plan was to pursue a smaller It did not help that the Internet company was also working through accounting issues with regulators who frowned on how Groupon was representing its revenue.Īs September dragged on, the underwriters encouraged the company to push ahead with an offering, despite the turmoil. Goldman Sachs and Credit Suisse, cut their estimates for pricing, according to one person with direct knowledge of the matter who was not permitted to talkĪbout the offering publicly. ![]() advisory firm.īut the enthusiasm, which seemed to reach a fever pitch earlier this summer, started to cool in August amid volatility in the equity markets and macroeconomic fears.Īt that point, Groupon’s bankers, lead by Morgan Stanley, Technology offerings have accounted for about a third ofĪll offerings this year, according to data from Renaissance Capital, an I.P.O. In the first half of this year, the technology sector propped up the larger I.P.O. Investors of all sorts eager to own a piece of the next great thing plowed millions into the new generation of start-ups, flooding the markets withĬapital and bidding up prices across the board.Īgainst that backdrop, a rush of technology companies went public, like Yandex,Ī Russian search engine, and Pandora, the online music service. Last two years set off a broader buying frenzy in Silicon Valley. Groupon, like LinkedIn and Zynga, is part of an elite cadre of start-ups that swiftly soared to multibillion-dollar valuations, capitalizing on the growth of online social networks. “This will be popular for short-term traders.” Schuster, who decided not to buy Groupon shares on Friday. “The risk is to the downside from here,” said Mr. Analysts are still skeptical that Groupon’s fundamentals justify the market value - a fear that echoed the dot-com boom in the late The question is whether Groupon will be able to move higher from here. Duda noted, he did not invest in Groupon. Mark Pincus, you’re probably doing back flips.” Still, Mr. “People were looking for reasons to be optimistic, well, they found it,” said Michael Duda, a venture capitalist at Consigliere, a consumer investment firm. Which had a successful debut in May, with shares more than doubling on the first day of trading, announced that it was planning to offer up to $500 million in additional shares. Some newly public companies are already re-upping. ![]() To follow sometime in 2012 with an offering that values the company at more than $80 billion. Facebook, a towering giant of the Web, is expected Zynga, which amended its filing on Friday with updated financials, is on track to make its debut within the next few months. Though it remains to be seen how Groupon will trade in the coming months, analysts say its strong first-day could usher in a second wave of investor enthusiasm for the next generation of Internet start-ups and embolden Worth even $5 billion - let alone its current 11 figures.īrendan McDermid/Reuters Andrew Mason, Groupon’s C.E.O., with his wife, Jenny Gillespie. In recent months, several analysts loudly questioned whether the company was “It indicates that people are willing to take risk again.”įriday’s surge was especially encouraging given the recent criticism of Groupon’s business model and lack of profitability. market for technology offerings,” said Josef Schuster, a money manager at IPOX Schuster. Groupon is also the first major company to go public since August, when European sovereign debt fears rattled investors and sent the I.P.O. Shares breached $31, before settling at $26.11 at the close, valuing the three-year old companyĪt $700 million, the offering is the largest for a Internet company in the United States since Google in 2004. The initial public offering, which was priced at $20 the night before, soared 40 percent at the opening bell to hit $28. And the daily deals site got a warm reception, a welcome sign for Internet start-ups still waiting to go Justin Lane/European Pressphoto Agency Groupon executives Eric Lefkofsky, left, and Andrew Mason on Friday.Īfter a months-long journey filled with blunders, Groupon punched its ticket to the public markets on Friday.
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