If it smells like fish…

Okay so Groupon is planning to IPO:

Don’t expect profits anytime soon: Groupon hasn’t turned a net profit in any of its first three years of operations, including a net loss of $389.6 million in 2010.

Then you read stuff like this:

So a company that owes $230 million more than it has, and appears to be burning through $100 million or more a quarter, is using money raised from later investors to pay back early investors?

And then this:

That last part is particularly interesting, and entirely true: according to the filing itself, two of the company’s co-founders — serial entrepreneurs Eric Lefkofsky and Brad Keywell — used Groupon’s winter funding round to cash out shares to the tune of $451 million.

And to top it all off:

Groupon’s S-1 lists many risks. But the biggest risk of all is that local businesses will realize that they can’t afford to give away the store and consumers will realize that the national deals aren’t deals at all.

Bernie Madoff should have focused on the Internet instead.

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