We don’t need no stinkin’ $6 billion…

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Group OnWell, the rumor running around the web this week was the possible acquisition of Chicago-based GroupOn.com by the tech giant Google.

Initial reports had it as a $2.5 – $3 billion deal; later reports doubled this buyout offer.

While there are no concrete confirmations, yesterday insiders reported that GroupOn spurned Google’s offer, possibly in favor of doing an IPO in the next year or so.

I have a few thoughts on this:

  • I like GroupOn – I subscribe to the daily newsletter; have used it twice so far (Art Institute of Chicago renewal; restaurant discount). I think it’s a brilliant concept – now widely copied, of course – that, once you see, you smack your head at the sheer obviousness of it. Duh! Why didn’t I think of that?
     
  • There were reports earlier this year that Yahoo! was trying to acquire GroupOn; that frightened me: Yahoo! – to me – is where promising start-ups go to die.
     
  • When I first heard about the possible Google purchase, I wasn’t surprised, but I kind of wished that they (GroupOn) had remained independent and continued to innovate in a way they couldn’t under the new Lord Masters.
     
  • Wow. GroupOn turned down a reported $5+ ($6?) billion. It must be 1) Crazy; or 2) Have a lot of faith in the products and its direction.
     

GroupOn just introduced some new tools, and – with these tools – they are actually moving into what is, to me, a Googlish direction. Among other things, it allows merchants to enter – online – various deals (I’ve only read an overview; may have some details wrong).

This is important for two reasons:

  • The current deal structure made potential deal partners wait for months before getting a listing, and it took a lot of human (salespersons) time/effort. Now more deals, can post a deal faster, less human intervention per deal. All of that goes right to GroupOn’s bottom line.
     
  • Is it just me, or does this sound a lot like Google’s Ad Sense, but for deals??
     

In other news, Amazon just invested $175 million in what is probably the No. 2 (after GroupOn) deal site, LivingSocial.

Fad? Flame-out? Over/underhyped?

Too early to tell, but investors are opening their wallets like it’s 1999.

Are we on the top of another internet bubble?