The Success Story of GrouponPosted: March 6, 2011 | |
Last Friday, I traveled to California for spring break to visit my friend Catie who is interning in San Diego. I had an amazing time: I got to run along the beach in San Diego, go on the rides at Disneyland (my favorite was Indiana Jones, you get to ride in a jeep!), mingle with Californians at local San Diego bars, walk up and down Hollywood Boulevard, ride the ferris wheel in Santa Monica and drink multiple margaritas in Old Town. It was, by far, the best spring break I have ever had.
While I was staying with Catie, she told me about all the great deals she had been buying through Groupon, a startup that offers daily deals on food and services in cities across the country and throughout the world. Through the site, visitors can buy great deals at discounted prices, such as 50 percent off at restaurants or pay $10 for $20 worth of merchandise on Amazon.com. So far, Catie has purchased a hot-air balloon ride at half-price, a sky diving session at half-price, and a discounted pedicure.
While I have used the site before, I never really thought of it as a startup because it got so popular so fast. However, once upon a time, Groupon was just an idea in the mind of an entrepreneur.
That entrepreneur was Andrew Mason. In 2007, he started a company called ThePoint, a platform that allows users to create donation campaigns for different causes. The website allows users to pledge money, providing their credit card number and information, yet no money is actually donated until a certain “tipping point,” or number of people joining the campaign, is reached.
The idea of “collective action” inspired Mason to create a small WordPress blog in fall 2008, named Groupon, that was powered by ThePoint and provided daily deals, like the deals the site promotes today. By summer 2009, Mason and his team shifted their focus to Groupon due to the rising success of the site. While ThePoint did not gain the recognition Mason had hoped, Groupon took off.
Today, Groupon is among the most popular startups in the world. The company made group-buying a worldwide phenomenon in just two years, and expanded to 1,600 employees and increased its value to more than $1 billion. Now, there are many other sites mimicking the idea of collective buying, such as LivingSocial, Dealster, and BuyWithMe.
Check out this article, where Mason gives some advice regarding startup companies. And in the meantime, check out Groupon for some great deals!