Dinner Is On Eric Lefkofsky: Groupon Co-Founder and U-M Alum Pockets $300M+ From Stock Sales, More to Come From IPO
Word of advice to anyone who dines with Eric Lefkofsky: make sure he picks up the bill. Trust me folks, he can afford it.
We always assumed the Groupon co-founder and University of Michigan alumnus would make a lot of money from the startup’s inevitable IPO. Sure enough, the online coupon site said Thursday that it wants to raise $750 million from going public, a number that values Groupon at $15 billion to $20 billion. On NPR today, the company said it plans to raise $2 billion to $3billion from the IPO.
According to SEC documents, Lefkofsky, who started Groupon along with CEO Andrew Mason in 2007, is the largest shareholder in the company, controlling 64.1 million shares, or 21.6 percent of Class A common shares being sold to the public.
In addition, he also owns 499,992 shares of Class B shares, which boasts unspecified more voting power than Class A. The stock structure guarantees Lefkofksy will continue to control Groupon long after its IPO.
However, Groupon has already made Lefkofsky a very, very, rich man, according to the SEC documents.
In April 2010, the company raised $135 million from investors, using most of the money to buy stock back from founders like Lefkofsky. The filings says Groupon paid Green Media, an investment firm jointly owned by Lefkofsky and his wife Elizabeth Kramer, $57 million to redeem 10.7 million shares.
In December 2010 and January of this year, Groupon raised a whopping $946 million from investors. The company then paid Green Media $257.5 million to buy back 16 million shares.
That means, through Green Media, the Lefkofskys pocketed $314.5 million. And this is even before Groupon goes public!
Michiganders have high hopes that Lefkofsky, who received both his undergraduate and law degree from the U-M, will spread a little love to the state.
Last week, LightBank, a seed fund founded by Lefkofsky and Groupon co-founder Brad Keywell, invested $1.5 million in Benziga, a Michigan-based news and stock analytic website.
That’s a start.