In spite of a strong opening for Groupon’s public debut Friday, there were still concerns about the viability of its business model. Groupon, the company that pioneered online group discounts, saw a stock increase of more than 30 percent in their first day. The stock closed at $26.11, though at one point had been as hight as $31.14. Analysts, however, are concerned that their business model is unsustainable.
Groupon makes its money through the frequent emails it sends out to subscribers. They take a cut of what people pay, and give the rest to the merchant. It has spawned a series of copycats, but none as successful. At the moment, Groupon is selling just 5.5 percent of available shares.
