Discount firm Groupon aims for $750m in US stock market float Three-year-old Chicago firm seeks backing for expansion after attracting 83m subscriber

Groupon is hoping to raise $750m from its initial public offering on the US stock markets. Photograph: Scott Olson/Getty Images

Online discount coupon service Groupon has confirmed plans to go public, announcing its intention to raise an estimated $750m (£460m) on the US stock markets and become the latest, and largest, social media firm so far to feed an investor frenzy for new technology companies.

Groupon, a three-year-old Chicago-based start-up, is by some measures the fastest growing firm in history. It notched up revenue of $94m in 2008, its first year of business. In the first quarter of 2011, revenues were $644.7m, according to information filed with US regulators.

The company sells coupons offering discounts, taking a cut in any money the business makes. It now has 83m subscribers across 43 countries.

In a letter to potential investors, Groupon's co-founder and chief executive, Andrew Mason, warned future growth could come at the expense of profit. Last year, the company lost $450m, compared with $6.9m in 2009 and $2.2m in 2008.

"In the past, we've made investments in growth that turned a healthy, forecasted quarterly profit into a sizeable loss," said Mason. "When we see opportunities to invest in long-term growth, I expect that we will pursue them regardless of certain short-term consequences."

The company warned it had lost money since its inception and it expected operating expenses to grow for some time. "We cannot be certain that we will be able to attain or increase profitability on a quarterly or annual basis," the filing said. But mounting losses have so far failed to put off investors. The value of Groupon and other social media sites including Facebook and gaming company Zynga have soared as investors have clamoured to get in on the action.

Groupon rejected a $6bn bid from Google last December and went on to raise $1bn from institutional investors. Analysts have recently pegged the company's value at $25bn.

The share sale looks set to create a new set of dotcom millionaire and billionaires as Groupon's investors and early employees see their shareholdings turn into paper fortunes. Groupon's largest shareholder, Eric Lefkofsky, a co-founder and board member, owns 64.1m shares, 21.6% of the company's Class A common stock. Mason controls 7.7% of the company.

The Groupon filing follows the sale of LinkedIn, the business network. It went public on 19 May at $45 a share and its stock soared to more than $100 on the first day of trading. , LinkedIn shares traded around $79, giving it a market capitalisation of about $7.5bn.

Facebook, the biggest social networking site is expected to go public next year and has seen its valuations soar from $60bn to $100bn in less than a year.