Groupon's biggest issue as far as I can see is that the value of their cut of the deal will eventually be heck of a lot closer to $0 than it currently is.
They are exploiting a market inefficiency (the gap between small biz and their potential customers) and it one that is closing rapidly via a multitude of sources, and not just from competition within the daily deal sector.
And although this post title is clearly being deliberately provocative, one thing is true: there are going to be plenty of businesses and deals currently being lauded, which turn out to be total disasters (as there were in previous cycles - Enron, AOL Time Warner, Excite@Home, Webvan, et al). It is certainly not unthinkable that the Groupon IPO is going to be one of them...?
(the amount of money that has already been taken off the table must be a near-deafening warning bell)
They are exploiting a market inefficiency (the gap between small biz and their potential customers) and it one that is closing rapidly via a multitude of sources, and not just from competition within the daily deal sector.
And although this post title is clearly being deliberately provocative, one thing is true: there are going to be plenty of businesses and deals currently being lauded, which turn out to be total disasters (as there were in previous cycles - Enron, AOL Time Warner, Excite@Home, Webvan, et al). It is certainly not unthinkable that the Groupon IPO is going to be one of them...?
(the amount of money that has already been taken off the table must be a near-deafening warning bell)