From 0 to $1B in 16 months

It took Groupon just 16 months to go from $0 to $1B.


How did they manage to achieve this?


  1. In 2007, founder Andrew Mason launched his startup “The Point” – a web platform that utilised social media to help people accomplish any goal together.

Result: so-so traction.


  1. In November 2008, a group of users decided their goal would be to receive a group discount.

Result: The rest of the users joined this initiative with much bigger enthusiasm compared to any other goal.


  1. Eric Lefkofsky, a co-founder of The point, offered to test an idea for a company “Groupon” that would entirely focus on group discounts.

And they invested $0 to test this idea:

3.1. On the first floor, in the same building they were working, there was a Pizza restaurant. They offered: Let’s do a two-pizzas-for-the-price-of-one offer. You pay us nothing upfront. We just sell your discount coupons and make money off that. You get your clients for free.

3.2. Both agreed.

3.3. They offered these coupons to all the businesses in this office building and nearby.

Result: The Pizza restaurant got new clients. The founders proved their concept and made some money before writing a line of code and investing a single dollar.


  1. They walked door to door offering local businesses new clients for free in exchange for a group discount.

Result: almost every service business wanted new customers for free. 🙂


  1. Instead of wasting time and money on developing a web platform around the Groupon idea, they just set up a WordPress blog for free to post offers on.

Result: first 500 clients.


  1. Groupon focused on offers that were inherently social: cafes, restaurants or movies.

Result: it naturally led to people sharing the website.


  1. Eventually, they doubled down on the social component offering these awesome things (utilise them for your company):

7.1. If not enough people join the deal, the deal will expire. You can see a countdown that motivates you to invite your friends to join this deal as quickly as possible.

7.2. After you buy a coupon, the platform offers to share it on social media.

7.3. You can only see the deals that become even more valuable if you enjoy them with friends like movies, cafes, etc. So you are interested in spreading the word.

7.4. To increase your motivation to spread the word, they offered a referral programme: help your friend to buy a deal, get $10.

7.5. They deliver daily emails with new enticing deals that motivate customers to keep coming back and buy more.

7.6. They offer you to buy a coupon for a friend. Your friend will receive a free deal as a gift.

7.7. They regularly post short, humorous “Groupon Guides to [enter something weird here]”. Each one spreads socially and drives traffic to the Groupon website and offer page.


  1. Groupon grew from 0 to over $1 billion after just 16 months in business.



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