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Groupon Still Losing Money, CEO Is Fired And Leaks Final Email
New submitter Inzkeeper writes with news that the CEO of Groupon met the axe today: "Groupon CEO Andrew Mason made public an email he sent to Groupon employees. He takes responsibility for the company's downturn, expresses his appreciation for his staff, and wishes them well. 'For those who are concerned about me, please don't be — I love Groupon, and I'm terribly proud of what we've created. I'm OK with having failed at this part of the journey. If Groupon was Battletoads, it would be like I made it all the way to the Terra Tubes without dying on my first ever play through.'"
Despite increased revenues, they are still losing about $81 million each quarter, and Wall Street needs blood.
I bet most stopped right there.
Blech. Signatures.
You need to be big like Amazon to lose money like that.
There's a company that pumped the highest profit in a quarter without pumping oil. Massive cash pile, no debt. And Wall Street continues to punish it. Wall Street wants bloods.
I nominate this for nerd meme of 2013. If slashdot was battletoads. If the republican national convention was battletoads. If shopping at Wal-Mart was battletoads. And then all those of us who never played it will have to make friends with gamefaqs all over again to understand WTF everyone is talking about.
"You're right," Fisheye says. "I should have set it on 'whip' or 'chop.'"
2 years ago Google offered $5B to $6B to buy Groupon. Groupon turned them down and today their market cap is $3B. Oops.
I've always hated him, but I'll go to his funeral just to make sure he's really dead.
Happiness in intelligent people is the rarest thing I know.
Ernest Hemingway
does this mean that everybody's caught on to their predatory business model?
No, not everybody. Just those who haven't seen it from day zero.
The thing is, they could probably stand to make a lot of money if they weren't quite so predatory. I think that for the most part, the people who bought the groupons were quite happy. However, the businesses who offered the groupons often got shafted. I'm sure they could easily change the way they they deal with businesses to make sure they have a much better experience. For instance, most of the time they push for no limits on the number of coupons sold. Instead, there should always be a limit, because most businesses aren't set up to handle the amount of business that Groupon could send to them. Groupon would still make money off the deal, and would probably even have some repeat business.
Anthropic principle: We see the universe the way it is because if it were different we would not be here to see it.
Now own up, who googled Battletoads?
Let's see, a company who cons small business into bad decisions by taking advantage of their inability to quickly do an ROI and assess risk, is themselves falling ill to their unmitigated growth and overhead.
How much could it cost to run a company that just sells coupons?
.. does this mean that everybody's caught on to their predatory business model?
It's worse than that: Not only is their business model predatory, it has a low first-mover advantage and minimal barriers to entry(and to the degree that the barriers are there, other people are way beyond them).
There is nothing stopping a bevy of more-or-less-exact imitators ('livesocial' and friends); but there is also nothing stopping the people who already issue the consumer's credit card and the small businesses' hosted-payroll service from spinning something ('Bank Amerideals(tm)').
Groupon was doubly screwed: not only are they vultures who are ultimately bad for the people they depend on to offer further offers, they are less efficient and well placed vultures than those who are already well entrenched. Bank of America, or any other major financial institution/credit card issuer, aren't creative enough to know their asses from a hole in the ground; but they are trivially better placed than groupon to skim a few extra percentage points from the transactions they already skim a few percentage points from.
No one with a 5 digit UID I can assure you that.
Do you Gentoo!?
See with a buyout offer, there's a lot too it. It isn't like when Google says "We'll give you $6 billion," that is final, that if Groupon says "Ok," Google has to hand over a check and it is done. No, rather it is the first step. Next step is the lawyers get together to draft some NDA type stuff, and then Google gets to go over what happens in the company. They get to look at the financials, the operations, all that shit. They get to have a real good look at what they are going to buy. Only if they are then happy, does it go on to a formal offer and then cash changing hands if that is signed.
What Groupon knew would happen is Google would have a look at their books and realize they weren't making money, and had no plan as to how to. Google would then say "Ya, I'm thinking: no," and back out. That would screw over any IPO because people would ask "Well hang on, what did Google see that was wrong?"
They figured, correctly, that if they just went public they could pull a fast one on people and get some cash. It appears they were right.