Groupon not selling to Google was the dumbest thing I've ever seen a company do. Ever.
And how would you rank it with Yahoo not selling to Microsoft?
Groupon updates IPO filing, admits it's unprofitable
61–70 of 89 posts
Re: Groupon updates IPO filing, admits it's unprofitable
#62Earlier quoted context omitted.
You might want to look into any class actions against groupon for expiring. California has very favorable gift card laws and I think the court would agree this is a gift card.
I believe Groupon's policy is that purchases don't ever expire, just the deal does. If you pay $x for some deal, and expires, you still have a credit of $x with that business.
I think state law pre-empts groupon's policy (Ca's law states it cannot expire unless the card is to multiple retailers and then it must clearly list the expiration date on it).
Re: Groupon updates IPO filing, admits it's unprofitable
#63I think groupon has gotten a huge boost from retailer desperation since the 2008 crash. They haven't existed in a normal economy. Not only might businesses decide they are not a good solution in hard times, but in the longer term as the economy recovers, they'll likely have less interest as well.
Re: Groupon updates IPO filing, admits it's unprofitable
#64Groupon not selling to Google was the dumbest thing I've ever seen a company do. Ever.
It was actually smart. Groupon wanted a hefty break-up $5B fee. Google refused. Groupon must have known that the deal would never pass muster at Google after real number crunching. Hence they refused. With the break-up fee they would have still made like bandits.
Source?
Re: Groupon updates IPO filing, admits it's unprofitable
#65Groupon is a fundamentally bad business and I wouldn't touch it with a 10 foot cattle prod. Some say that we know they're not profitable but that's really not the point. By counting customer acquisition as an extraordinary expense they are implying that: 1. The value of that customer is AT LEAST as much the cost of acquisition; and 2. That cost also accounts for the natural loss of customers. This is shady because (I…
This thread from last year makes for an interesting read in the light of the numerous accounting revisions. Of course, we doubters might to turn out to have egg on our faces yet.
Re: Groupon updates IPO filing, admits it's unprofitable
#66Earlier quoted context omitted.
I'm surprised so few people are familiar with the "land grab", it seems to me that's what they are attempting. In the early days Amazon was spending something like $20 on average per customer acquired and was losing money hand over fist. That's not to say I think Groupon will be the next Amazon: This is a risky strategy. But it can pay off massively if you cement yourself as the only big player in an emerging market.
A land grab only makes sense if you have constructed or inherited barriers to entry... what are their barriers? They're grabbing land that will be stolen the next day from them by LivingSocial or Google Offers...
Exactly. Amazon's acquired land was defensible, so to speak. Once it acquired a customer, that customer was likely to stick around.
As the numbers show, Groupon can only get 20% of all first time users to buy something. And yet, it counts all prospects as "customers." And even for those who do buy a groupon or two, what reason would they have to stay loyal to Groupon? At best, Groupon is poised to become one of many big commodity providers in this market.
(Speaking of Amazon, btw, what's to stop them from getting into this market eventually?)
Re: Groupon updates IPO filing, admits it's unprofitable
#67Earlier quoted context omitted.
We'll see.. http://www.minyanville.com/businessmarkets/articles/web-ipos... "Groupon is still effectively insolvent, and without capital infusions is unlikely to exist in 18 months." In my opinion, valuing a company at $10B when they haven't ever shown a net profit is ludicrous.
Are they letting Goldman Sachs handle the IPO? GS is pretty evil in pushing ridiculous IPO values in order to get their higher cut. Cant wait to see what BS goes on with GS handling Facebooks IPO.
That's an interesting point. GS has been having a rather lackluster year so far (by their own standards - many other firms would love to have their problems). The firm is caught between a rock and a hard place; it needs to demonstrate everything is above board and strictly in accordance with the law, but is also under pressure from investors to improve performance. Not that so much hinges on any one deal, but this IPO has become something of a barometer for the sector absent an announcement by Facebook.
Re: Groupon updates IPO filing, admits it's unprofitable
#68Earlier quoted context omitted.
Google's offer was $6B. The IPO is priced at $30B. I am scratching my head how that is the dumbest thing you have ever seen a company do. Ever. I can see the IPO valuation getting cut to a more reasonable $10B, but that is still more than the Google offer.
We'll see.. http://www.minyanville.com/businessmarkets/articles/web-ipos... "Groupon is still effectively insolvent, and without capital infusions is unlikely to exist in 18 months." In my opinion, valuing a company at $10B when they haven't ever shown a net profit is ludicrous.
Welcome to the 1990s!
Re: Groupon updates IPO filing, admits it's unprofitable
#69Groupon is a fundamentally bad business and I wouldn't touch it with a 10 foot cattle prod. Some say that we know they're not profitable but that's really not the point. By counting customer acquisition as an extraordinary expense they are implying that: 1. The value of that customer is AT LEAST as much the cost of acquisition; and 2. That cost also accounts for the natural loss of customers. This is shady because (I…
Not only is their accounting on customer acquisition bogus, but how do they possibly value these customers? FTA: Groupon's subscriber count -- the one Mason says it is spending aggressively to beef up -- now stands at 116 million, up from 83 million at the end of last quarter. Among those subscribers, 23 million have purchased a Groupon at least once. So they have 116 million "customers," but less than 1 in 5 of thos…
Exactly! Subscriber != customer. These are the exact kinds of statistics and statements that companies made in the first tech bubbble.
Re: Groupon updates IPO filing, admits it's unprofitable
#70Groupon is a fundamentally bad business and I wouldn't touch it with a 10 foot cattle prod. Some say that we know they're not profitable but that's really not the point. By counting customer acquisition as an extraordinary expense they are implying that: 1. The value of that customer is AT LEAST as much the cost of acquisition; and 2. That cost also accounts for the natural loss of customers. This is shady because (I…
After the IPO happens... this will quite possibly be the best or worst post that ever occurred on HN. I can't wait to come back to this in a year.
If the IPO happens.