It's the continuation of a strange cycle. Path is a social network the encourages you to have only a few friends, why not acquire a company that hasn't launched for the users?
There are several things that seem absolutely insane about this to me.
#1 Groupon is valued at $15 Billion? Have people lost their minds?
#2 They're offering to buy hipster, a company that I've never used, and have only barely heard of. Hipster.com appears to be an ISP in Nevada, and googling hipster turns up things related to hipster culture.
Buying users used to be a reason to acquire a product, but not anymore. Users are cheap. And Groupon already has one of the best email distribution channels out there
Its about the product and the team. Hipster is Quora meets Yelp, and the tech was in fact live for a while, just only in Boulder, CO. If Groupon wants to build a team & product to attack social local recommendations, its actually a smart move
The number is not big, less than 10 million dollars. You have no idea many employees they have or what kind of talent they have. This number is well in line with Google's talent acquisitions in prior years.
Every bubble always has a "rational explanation" for the valuations. "This time it's different" they say. Always.
This time is no different. Of course you can explain why paying $10M for an unlaunched site makes sense to a company that just turned down $6 billion from Google, who itself is valued at $200B.
okay okay okay, I'm leaning towards Techcrunch being trolled here, well I seriously hope that's the case, otherwise does anyone have a good idea that includes social, saving money and local divisions? If so, I've got some mediocre CSS skills and $10 to buy a domain with...
the ONLY way this can be true is if they've built an incredible backend that groupon want to use to expand and aren't interested in doing it themselves.
From what I hear, Groupon doesn't do a lot of their engineering in house. Buying a company that can make their site into more of a 'local destination' like Yelp/Hotpot/CitySearch makes a lot of sense. And they can probably get them for a much cheaper price pre-launch.
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[ 3.7 ms ] story [ 70.0 ms ] thread#1 Groupon is valued at $15 Billion? Have people lost their minds?
#2 They're offering to buy hipster, a company that I've never used, and have only barely heard of. Hipster.com appears to be an ISP in Nevada, and googling hipster turns up things related to hipster culture.
Am I missing something?
Tomorrow's news: Quora rejected $11 trillion offer from Groupon!
This is the scariest part to me. I was kindof under the impression that, at least right now, you're not really buying tech, you're buying users.
"Hipster" has none.
Its about the product and the team. Hipster is Quora meets Yelp, and the tech was in fact live for a while, just only in Boulder, CO. If Groupon wants to build a team & product to attack social local recommendations, its actually a smart move
January 2011: Groupon values itself in the $15b range with an IPO: http://dealbook.nytimes.com/2011/01/13/groupon-readies-for-a...
Hmmmmm....
You could mark me down today with this news.
Also the space they're in is very very relevant.
This time is no different. Of course you can explain why paying $10M for an unlaunched site makes sense to a company that just turned down $6 billion from Google, who itself is valued at $200B.
Doesn't make it any less of a bubble.
the ONLY way this can be true is if they've built an incredible backend that groupon want to use to expand and aren't interested in doing it themselves.