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A Groupon IPO is one of the worst things that could happen to the industry, at any price.

It's reminiscent of the .com crash and it gives me serious doubts about the rationality of the current tech market.

Let's sell stuff at a discount so large that the merchants lose money but we make money is not a sustainable business model, it's a predatory strategy. How on earth could you offer stock in a venture like that to the public with a clean conscience?

Sooner or later you run out of merchants, it only works for goods that have such a huge profit margin that you can actually afford that. And I rarely see Groupon deals that suggest that they're still profitable for the merchants. Why merchants do Groupon deals is a mystery to me, maybe someone that has done a Groupon deal as a merchant can shed some light on the economic returns for them.

Maybe they're out-of-band in recurring visitors or something like that but I simply don't get it. Or maybe there is something crucial about how Groupon operates that I'm missing, in that case enlighten me please.