Daily deals giant Groupon has raised $950 million in funding to change the way people shop locally and to continue to service neighborhood businesses.

Specifically, Groupon will use the funding to expand globally, invest in new technology and provide liquidity for employees and investors. But, what?s most interesting about the raised funding is the new-found confidence it brings to the location-based marketing and group-buying deals space.

"Groupon's near-billion dollars in funding clearly indicates the game is afoot for the entire group-buying industry,? said Kate Forgach, content editor at CouponSherpa.com, Fort Collins, CO. ?Groupon felt confident enough in their business model to not only reject Google's [acquisition] offer but withstand that company's threat to buy a competitor or create their own.

?Even Facebook is trying to get in on the action by experimenting with Groupon-style discounts via Facebook Places,? she said. ?All things considered, it's no wonder Groupon's high-profile funders were willing to invest such large sums in the big daddy of group buying.?

Groupon?s milestones
In the past year, Groupon has expanded its global footprint, as the company now offers daily deals in 35 countries.

In 2010, Groupon launched in almost 500 new markets, up from 30 markets in 2009. It grew its subscriber base 2,500 percent.

Currently, Groupon has 50 million subscribers.

The company claims it has saved consumers more than $1.5 billion

Groupon has worked with 58,000 local businesses, serving a total of more than 100,000 deals globally.

"We're thrilled that Groupon has earned the confidence of some of the world's most respected investment firms," said Andrew Mason, founder/CEO of Groupon, Chicago, in a statement.

"With their support, we will continue on our mission to change the way people shop locally and serve the world's local businesses," he said.

Groupon did not respond to press inquiries.

History
Groupon launched in November 2008 in Chicago. The service features a daily deal on the best stuff to do, eat, see and buy in more than 500 markets around the world.

The company uses collective buying power to offer discounted prices, delivering more than 650 daily deals globally.

The Groupon smartphone application is all the craze right now. It features unbeatable deals on some of the best stuff each day.

Users never have to print another coupon. It is available in tons of cities all over the world and more distribution areas are announced daily.

"People are demanding deals from hyper-local merchants, as opposed to large national chains. But they want the buying power of Groupon, which can drop prices as low as 50 to 60-percent off,? Ms. Forgach said.

"Location-based marketing is ultimately heading into even more and smaller locations, now that the major cities are being covered,? she said. ?For example, I recently purchased a Groupon coupon for dental services in a town with less than 15,000 residents."

Group-buying
Group-buying sites are all about collective bargaining. Consumers get great deals while participating merchants get increased sales numbers. 

With Groupon, a new deal is posted daily for each participating city and if a minimum number of buyers sign up, the deal is activated.

?The Groupon funding reinforces the power of this kind of discount service,? said Neil Strother, practice director of ABI Research, Oyster Bay, NY. ?Groupon?s growth has been phenomenal and they are riding a wave right now.

?However, I don?t think that they will rock the world forever,? he said. ?There are some speed bumps to the group-buying model, like if enough people don?t participate, then I don?t get the deal."

Final take
Here is Groupon on Fox News, a year ago

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