Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Groupon stock sinks to new low, investors sue

chicagobusiness.com

Post reply on HN
Print view View original

71–80 of 137 posts

Re: Groupon stock sinks to new low, investors sue

#71

Post by __float »

joezydeco wrote: post #47
guptaneil wrote: post #7

As a Silicon Valley native currently living in Chicago, I've always found it disappointing that Groupon is the poster child of innovation and entrepreneurship in Chicago. They seem to lack a solid business plan and have a history of deliberately misleading investors and businesses. Far more impressive companies, such as 37signals or GrubHub, are based here that deserve that kind of attention instead. I very much doub…

"Far more impressive companies, such as 37signals or GrubHub, are based here that deserve that kind of attention instead." Every time someone says this, the neck-hairs of every Orbitz employee (current and former) stand up on end and twitch a little.

I don't think that's exactly the same comparison. Orbitz, to me, seems much more corporate and doesn't have the same connection with the developer and startup community that these do. That's not to say Orbitz isn't worthy of attention, merely they don't shove it in our faces like 37signals ;)

Re: Groupon stock sinks to new low, investors sue

#72

Post by johnrob »

guptaneil wrote: post #7

As a Silicon Valley native currently living in Chicago, I've always found it disappointing that Groupon is the poster child of innovation and entrepreneurship in Chicago. They seem to lack a solid business plan and have a history of deliberately misleading investors and businesses. Far more impressive companies, such as 37signals or GrubHub, are based here that deserve that kind of attention instead. I very much doub…

The plan might be the most rational one I've heard regarding Groupon. Not the most moral strategy, but it's one that seems to factor in their vague value proposition.

Re: Groupon stock sinks to new low, investors sue

#73

Post by tucson »

byrneseyeview wrote: post #45
Quizzy wrote: post #21

They should have unloaded this fraud on Google when there was a $6 billion cash offer sitting on the table (assuming that was true). The fact that Google even offered that much leads me to believe that they have jumped the shark with that offer. Anybody who knows anything about retail would have studied the business model and realized that this was not sustainable. Obvious red flags: 1. Heavy reliance on field sales…

Why should they have sold for $6 billion? They're worth $9.6 billion today. Groupon is not a bet on the coupons business--that doesn't justify the current valuation. Groupon is a bet that if you can reinvent the Yellow Pages, at scale and online, you can make a ridiculous amount of money. It's probably one of the largest companies around with such a high probability of failure, but their value if they end up being th…

Assuming Google was ok for the deal they could have sold 100% of the company against cash or maybe Google stocks. Instead they sold I think only 5% during the IPO. Right now the CEO cannot sell more of his shares until May 2012 (http://ipo.nasdaq.com/Fundamentals.asp?cikid=826818&fnid...).

Re: Groupon stock sinks to new low, investors sue

#74

Post by zaidf »

JHSheridan wrote: post #68
zaidf wrote: post #40

Earlier quoted context omitted.

It worked on the novelty effect and it was doomed to fail. A little premature to write an obituary of a company that finished 2011 with 1.6B in revenue.

This argument always blows my mind. Who cares about revenue? Profit is what counts. If you make 10 trillion, but have to spend 10 trillion and 1, you're failing. Web-based companies have to make a profit too. Why do people forget this?

Saying "who cares about revenue?" is just as faulty as stating "who cares about profit?"(which I never stated).

Re: Groupon stock sinks to new low, investors sue

#75

Post by muraiki »

notJim wrote: post #56
Quizzy wrote: post #26

Earlier quoted context omitted.

Anecdotally, the first generation of sales rep have nothing but depressing things to say about this entire market segment now. The first year sales numbers were gangbusters, until their clients called back complaining, swearing never to do another Groupon deal, ever again. It's not just Groupon, this entire business model is unsustainable: asking a retailer to discount his products for a fee in the hopes that he will…

Not only that, but I suspect that people who are loyal to businesses and like interacting with local business owners are less likely to use sites like groupon, because they know that the businesses often get screwed, and because they don't want to be thought of as bargain-shoppers.

A friend sent me a Groupon for a local bakery. It was something ridiculous like $20 worth of food for $10. Since I had heard about the bad relationships between businesses and Groupon, and since I actually like this little store, I declined to get the Groupon. I'd rather pay full price to support a local business!

Re: Groupon stock sinks to new low, investors sue

#76

Post by zaidf »

ohashi wrote: post #65
zaidf wrote: post #40

Earlier quoted context omitted.

It worked on the novelty effect and it was doomed to fail. A little premature to write an obituary of a company that finished 2011 with 1.6B in revenue.

1.6B in revenue is pretty meaningless if you're not even making a profit. They are simply really good at losing a lot of money.

It's "scary" and "even" dangerous one may say, but not meaningless.

Re: Groupon stock sinks to new low, investors sue

#77

Post by bhousel »

run4yourlives wrote: post #43

Investors sue? Really? So basically, I want to drink the koolaid but god damn you if it makes me sick... You should not be allowed to sue as a method to correct your own stupidity.

It's very common.. Investment decisions are often made based on things that representatives from a company say to the press, or details reported in their public SEC filings. Any inaccuracies in these statements can be the basis for a lawsuit.

Lawsuits are basically part of the cost of doing business nowadays.

Re: Groupon stock sinks to new low, investors sue

#78

Post by awj »

tptacek wrote: post #41
pbreit wrote: post #12

Earlier quoted context omitted.

> I was in a barbershop a few weeks ago, where the owner told me about one of the Groupon executives who was in the shop earlier Great source!

I don't know why this was downmodded. It's trenchant. Nobody on HN seems to like Groupon, but that doesn't make this kind of ridiculous hearsay more valid.

I don't think selectively quoting to omit "I very much doubt the legitimacy of this story" then commenting "Great source!" is adding anything useful to this conversation.

Re: Groupon stock sinks to new low, investors sue

#79

Post by tptacek »

awj wrote: post #78
tptacek wrote: post #41

Earlier quoted context omitted.

I don't know why this was downmodded. It's trenchant. Nobody on HN seems to like Groupon, but that doesn't make this kind of ridiculous hearsay more valid.

I don't think selectively quoting to omit "I very much doubt the legitimacy of this story" then commenting "Great source!" is adding anything useful to this conversation.

Disagree. The original post was deeply disingenuous.
Post reply on HN