Did it or didn’t it raise the largest VC round in history?
That was the question many were asking when word began to leak that daily deals site Groupon had raised $950 million in Series E funding. The problem was that we didn’t know how much of that staggering amount was new equity, and how much of it represented liquidity for existing shareholders.
Now we know, thanks to a regulatory filing: More than $573 million of Groupon’s take was used for liquidity, which means that only $377 million was new equity. That falls well short of first on the all-time list, but is still good enough for fourth (just above a $350m round for Better Place, and below $402m for Carolina Broadband).
No idea where this ranks in terms of the list of non-control deals for cashing out private company shareholders. Actually, I don’t even think such a list exists — although, if it did, Facebook’s deal with Goldman Sachs would probably take the top spot (even without U.S. investors).
As we’ve previously reported, existing Groupon shareholders were given a chance to sell up to 15% of their holdings via this offering. Seems more than a few of them were upset that Groupon turned down Google’s (GOOG) $6 billion buyout offer, and this was a way for Groupon management to make peace.
Some of the $573 million pie also belongs to Groupon management itself, but the regulatory filing does not break down that level of detail.
The only other piece of new info is that Groupon paid a $7.5 million “finder’s fee” as part of the round. My best guess is that it went to Allen & Co. — which reportedly served as placement agent — but the bank is not listed in the filing’s broker-dealer section.