Groupon’s (GRPN) initial public offering is generating a lot of buzz, but is it a good deal? Ultimately the market will decide that, but investors are watching to see how the high-profile company’s shares trade in their debut.

After all, the IPO market is coming off its worst month in two years and there are hundreds of companies stuck in the pipeline.

That has left investors and employees in these companies as well as underwriters banking on Groupon’s stock succeeding to keep the IPO spigot open long enough to squeeze out more deals before Christmas.

“If Groupon wins, everyone wins,” quips Ben Holmes of IPO advisory firm Morningnotes.com. “The US internet information providers, Zillow, LinkedIn, and Home Away have been a solid group, with the exception of Pandora.”

Zillow is up some 50% from its offer price, LinkedIn is 89% higher, while Home Away has gained 64% from its IPO. Pandora is 6% below its offer price.

John Glasmann of Precision Securities adds, “There is, no doubt, an agenda behind getting this one to work. The question is will it be like Pandora, which broke the IPO price, or LinkedIn, which worked well and continued after day one.”

While Groupon sports a hefty $12.7 billion valuation, the deal site sold a relatively small stake in the company--just 5.5% of total shares outstanding. An IPO trader close to the deal said the 35 million shares were seven times oversubscribed. That’s why the shares priced $2 above the expected range and still left room for a 40% pop as it opened on the Nasdaq.

Glasmann, a veteran IPO trader, says, “The scarcity play and uniqueness of Groupon is what makes it attractive, even though the longevity of its attraction remains a mystery. I recall that Amazon.com and Google also had questions of long-term viability when they began trading publicly.”

Not everyone is buying into the latest wave of tech listings. One long-time Wall Street trader said he and other insiders were left asking “why” Groupon had generated so much investor interest and was oversubscribed. “It does seem to feel like the .com days. No one has forgotten the burn.”

IPO watchers note more tech companies including Angie’s List and Digital Domain have in recent days filed to sell shares to the public, so momentum is building. And all eyes are now turning to the next big IPO on the calendar, social game-maker Zynga. It is expected to sell shares to the public in two weeks.

A source close to the IPO market says there’s even more enthusiasm for this upcoming offering. “Zynga’s the one. They’re going to have great earnings. The nice thing about Zynga is they have a lot of room to grow.”