Google shopping for Groupon wannabe: sources
Google, whose $6 billion buyout offer was spurned by online coupon site Groupon, is in talks with much smaller rivals of the two-year-old firm, a source close to the situation told The Post. — The deal talks show that the search giant …
Context & Ripple Effects
Google's local-commerce push has been running through dealmaking all fall: BoomTown flagged the search giant's interest in Groupon back on November 19, the Telegraph followed with Groupon's own explanation of why takeover talks were happening, and a Google executive argued at the start of December that the company buys rather than builds when speed matters ("No Time to Build, So We Buy"). The $6 billion offer failed anyway — Groupon walked away from what would have been one of Google's largest acquisitions ever.
The Post's report is the rumor that fills the gap: per the source, Google is now circling much smaller Groupon rivals, which would let the company enter daily deals through the side door rather than pay for the category leader.
First-order effects
- Unnamed small daily-deal startups suddenly hold a credible exit option backed by the most acquisitive buyer in tech — talks alone reprice their fundraising and sale conversations.
- Groupon's rejection leaves it competing against Google's distribution without Google's money, raising the stakes on its own independent growth path.
Second-order effects
- Other potential acquirers of coupon sites — Amazon, Yahoo and the rest floated as bidders since the November speculation — face pressure to move before Google lands a smaller target cheaply.
- If Google buys or partners into deals, merchants gain a second major channel for offers alongside Groupon, weakening the two-year-old firm's hold on local-advertiser relationships.
Third-order effects
- A successful bolt-on would confirm the buy-over-build doctrine Google executives stated publicly this month, pushing more local-commerce founders to design companies as acquisition targets rather than standalone businesses.
- The episode marks daily deals consolidating from a standalone category into an attachment for search, email and payments platforms — with ownership of the merchant relationship, not the deal inventory, as the long-term battleground.
The trend: Local daily deals are being pulled from independent startups into the orbits of large platform companies, with Google's post-Groupon shopping spree as the clearest data point yet.