Groupon Said No!

By now, you should know Groupon has turned down Google’s almost (so far reported) $6 billion offer for the company. The basics: Groupon is a high valued site, which brings together retailers and consumers so as to offer good deals. Through the website, people are able to share such deals using social media platform. Google wanted to purchase the website expected to have a value of $1 billion for supposed $6 billion. Groupon turned down the offer.

People are left wondering the reasons would Groupon give up the chance to let Google take them over. Recently, I read "Google's Groupon Groping Reveals the Shifting Power in the Web World" by Paul Smalera". Smalera gave a web dichotomy perspective for the turn down. Smalera stated Groupon is a social website where as Google is more search oriented and has not been so successful with social ventures. Groupon might feel better being acquired by Facebook (if they were interested) or any other giant social media company, which could then integrate better with the website. The other point made is Groupon would want to be taken by which ever company could mature it the best.

Smalera’s perspective is very fascinating but when I first heard of the decline, I observed from a different perspective. The control perspective.

Some entrepreneurs are start-up junkies. This is a term I took from the reality show of the same name that goes behind the scenes of a start up. The CEO of the company, Ron Weiner had started up various companies and sold them for high value. Some entrepreneurs start companies with the intention of eventually selling. Other entrepreneurs start companies and intend to maintain control of their creation. This intention might explain Groupon’s decline.

Groupon might want to stay independent and maintain control over the progression of the company. As far as growing, Groupon might believe it can help itself grow more and that continuing to do so under their control, the company could gain more value. My point is we can’t always assume such a decline is due to a defect in Google. Simply put, maybe, Groupon doesn’t want to have a Google takeover.

Groupon was supposedly in negotiations for a week. So I could be wrong; Groupon might just be bluffing or waiting for the next bidder. I’m just offering a different perspective. But remember this: Just because an entity is bigger, more powerful, and has more capital does not mean everyone wants to be owned by them. There is enough space for many web based companies to thrive and the natural progression of the web should not be eventual takeovers of smaller companies by bigger ones.

Note: For references to Google and Groupon, the links go to crunchbase.com. I just discovered this database of tech info. Its similar to a wikipedia for technology.