91–100 of 137 posts
Who would guess that there could be an integrity issue with a company that tried to invent new accounting rules where marketing costs don't appear on the balance sheet? You'd have a crystal ball or a brain to see this coming.
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"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 ;)
It's a shame that a lot of people have forgotten that and mention Groupon and GrubHub like they're the one-and-only models for a startup scene in this city.
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I think in this case it makes sense. Groupon restated a sharp drop in their reported revenues over three years. People don't necessarily invest in things they think are particularly good business models. They invest in things that are undervalued. If you looked at the revenue/price and thought it was undervalued and then Groupon changed 3 years worth of data on your after you made a stock purchase, you'd sue too. Jus…
People don't necessarily invest in things they think are particularly good business models. If you can't figure out the business model generating the reported millions, it's your own fault for thinking those millions are undervalued. How many of these investors didn't actually care about the value of the stock, so long as there was somebody around tomorrow that would buy it for more? Sorry, but I have no sympathy whe…
How, exactly, would I figure out that Groupon was lying/mistaken in their financials?
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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.
Who would have imagined that groupon had a future? It worked on the novelty effect and it was doomed to fail. On the other hand, Chicago business is full of bugs. Ghostery block 13 (!) calls to different websites such as: Quantcast, 24/7 real media, Outbrain etc... I won't visit this website again. I wish I was warned of that before hand not when I go to the website, I value my privacy more than going there.
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.
Who would have imagined that groupon had a future? It worked on the novelty effect and it was doomed to fail. On the other hand, Chicago business is full of bugs. Ghostery block 13 (!) calls to different websites such as: Quantcast, 24/7 real media, Outbrain etc... I won't visit this website again. I wish I was warned of that before hand not when I go to the website, I value my privacy more than going there.
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.
Revenue != profit. You could generate a trillion in revenue. What's left after the bills are paid is what counts.
Who would guess that there could be an integrity issue with a company that tried to invent new accounting rules where marketing costs don't appear on the balance sheet? You'd have a crystal ball or a brain to see this coming.
Marketing costs are not supposed to appear on balance sheet. I don't really watch this company but if I remember correctly, their way of doing accounting was to show all received money from customers as income instead of liabilities since they were collecting half of it on behalf of vendors. They were simply inflating their revenue but it's not like it matters, because profit (loss) would be always the same regardles…
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Thanks for the link. What I find troubling is to read so many articles pointing to shady business practices from Groupon and bubble valuation, and still the SEC lets the IPO go through and investors lose their money - that part did not happen yet but it seems written on the wall.
Could the SEC really do that? Just outright stop an IPO?
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Thanks for the link. What I find troubling is to read so many articles pointing to shady business practices from Groupon and bubble valuation, and still the SEC lets the IPO go through and investors lose their money - that part did not happen yet but it seems written on the wall.
Could the SEC really do that? Just outright stop an IPO?
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There's nothing ridiculous about using sales as a customer acquisition strategy. What is unsustainable about GroupOn, etc. is the requirement for extreme discounting that crushes the retailer.
Two more problems with the model: 1) Groupon taks a large cut on top of the big discount. It used to be that GroupOn wanted a 50% discount and then 50% of the revenue. This is like running a 75% off sale. 2) The customers are poorly-qualified leads. All we know is that they are local and like a good deal. That doesn't give the retailer much indication that they would be a good customer (and I think we have seen that…
I remember my girlfriend many years ago working in a restaurant that offered a ‘kids eat free’ deal one night a week. People would come in with their kids and their neighbors’ kids, order one burger and let the restaurant feed a bunch of kids for nothing. Obviously the restaurant needed to put some terms around the deal, which they later did, but some people are just a blight on humanity in this way.