Groupon Plunges as Board Members Reportedly Leaving • Hacker News Board

Re: Groupon Plunges as Board Members Reportedly Leaving

#21

Post by mitchellhislop » Mon, Apr 30, 2012, 9:41 PM UTC

kin wrote: post #14

Alex3917 wrote: post #6

When board members quit unexpectedly like this it usually means they have discovered that the management is doing something unethical and they don't want to be held legally liable for it, which they would be if they stayed. This is likely a sign that we're going to see another scandal or two coming out of Groupon in the next few months, possibly one that tanks the company completely. Wall Street knows this, which is…

Besides the occasional unethical sales methods by some of its employees, were there any other scandals that I'm not aware of?

Mostly the shoddy/incorrect/fake accounting issues that have gotten them in hot water with the SEC.

Actually, that is (in my mind) the biggest current one - the sales stuff is bad, but the accounting and operations stuff is Bad.

Re: Groupon Plunges as Board Members Reportedly Leaving

#22

Post by janlukacs » Mon, Apr 30, 2012, 9:41 PM UTC

we'll be reading the same about Facebook in a couple of years? most probably.

Re: Groupon Plunges as Board Members Reportedly Leaving

#23

Post by mcknz » Mon, Apr 30, 2012, 9:42 PM UTC

mikemarotti wrote: post #8

Is it too late to think about shorting this stock?

Yes. Probably no stock available to borrow. There are put options but those are likely already at a premium.

Re: Groupon Plunges as Board Members Reportedly Leaving

#24

Post by scarmig » Mon, Apr 30, 2012, 9:46 PM UTC

janlukacs wrote: post #22

we'll be reading the same about Facebook in a couple of years? most probably.

Facebook is bubbly, but there's a world of difference between having your value inflated by a bubble and what's effectively accounting fraud.

Re: Groupon Plunges as Board Members Reportedly Leaving

#25

Post by corin_ » Mon, Apr 30, 2012, 9:49 PM UTC

calpaterson wrote: post #19

huggyface wrote: post #12

Earlier quoted context omitted.

Groupon is hardly even a tech company, and their business model is one that has been seriously criticized since the outset. There will be little collateral damage from their decline.

Pets.com was not ostensibly a tech company either. Their business model was also criticised. There was much collateral damage from their decline.

Back then selling products online was enough to make you a "tech company", it's a very different landscape out there now.

Re: Groupon Plunges as Board Members Reportedly Leaving

#26

Post by cube13 » Mon, Apr 30, 2012, 9:50 PM UTC

calpaterson wrote: post #19

huggyface wrote: post #12

Earlier quoted context omitted.

Groupon is hardly even a tech company, and their business model is one that has been seriously criticized since the outset. There will be little collateral damage from their decline.

Pets.com was not ostensibly a tech company either. Their business model was also criticised. There was much collateral damage from their decline.

By that definition, Amazon wasn't a tech company, either. Remember that it started purely as an online bookstore.

Re: Groupon Plunges as Board Members Reportedly Leaving

#27

Post by larrys » Mon, Apr 30, 2012, 9:52 PM UTC

huggyface wrote: post #12

rollypolly wrote: post #2

Could this be the beginning of the end of Bubble 2.0? I understand this is just one company, but what I'm wondering is if this could have a domino effect.

Groupon is hardly even a tech company, and their business model is one that has been seriously criticized since the outset. There will be little collateral damage from their decline.

"There will be little collateral damage"

Added: Yes there will be collateral damaged.

They are dotcom. They operate a website and they send their deals by email. The founder is young, does silly things (cat on head picture not something they do at Boeing or GE) and has been profiled in major media. They will be associated with tech whether deserved or not.

Defacto. If there was no connection nobody in our "business" would be talking about it.

Here's the recent IPO's. Splunk is tech. Nobody else has any connection and would never be mentioned as "dotcom" or tech.

http://www.hoovers.com/100007201-1.html

Re: Groupon Plunges as Board Members Reportedly Leaving

#28

Post by trotsky » Mon, Apr 30, 2012, 9:55 PM UTC

AlexMuir wrote: post #10

When a director with a lot to lose (Howard Schultz) leaves so suddenly, one can guarantee that there's something coming which significantly threatens his position outside Groupon and/or reputation. So much so, that he is willing to piss off investors, employees and co-directors by upping and leaving. I suspect that the writing is on the wall for Groupon. I'm going to predict that it won't see 2013 without serious res…

For what it's worth, these two were both on the audit committee which was criticized in the wake of the earnings restatements last month:

"Groupon needs a new audit committee with much more financial expertise," said James Post, a management professor at Boston University.

http://articles.chicagotribune.com/2012-04-12/business/chi-g...

Re: Groupon Plunges as Board Members Reportedly Leaving

#29

Post by tedsuo » Mon, Apr 30, 2012, 9:56 PM UTC

To what degree were people predicting the fall of pets.com before it happened? Anyone remember? I think that's the key insight into how the fallout of a groupon meltdown would affect the rest of the industry.

Re: Groupon Plunges as Board Members Reportedly Leaving

#30

Post by ljlolel » Mon, Apr 30, 2012, 9:58 PM UTC

scarmig wrote: post #24

janlukacs wrote: post #22

we'll be reading the same about Facebook in a couple of years? most probably.

Facebook is bubbly, but there's a world of difference between having your value inflated by a bubble and what's effectively accounting fraud.

Groupon is definitely worse than Facebook, but still, http://www.jperla.com/blog/post/facebook-is-a-ponzi-scheme