Groupon Plunges as Board Members Reportedly Leaving • Hacker News Board

Re: Groupon Plunges as Board Members Reportedly Leaving

#91

Post by nikcub » Tue, May 01, 2012, 1:41 PM UTC

suresk wrote: post #68

nollidge wrote: post #15

What I'm wondering: are any of Groupon's competitor's (AmazonLocal, LivingSocial, Google Offers, etc.) more likely to succeed? Or is the business model the biggest problem here?

I don't think the business model is quite as horrible as some make it out to be, but it certainly doesn't seem to warrant a $6+ billion valuation for Groupon and doesn't really bode well for some of its competitors. I see two major problems Groupon is facing: 1) Limited long-term market A lot of companies have had negative or even disastrous results from using Groupon. It is clear that it isn't a good option for a lo…

> and there is almost no barrier to becoming a competitor

except user acquisition costs on both ends of the transcation, which are ridiculous. i doubt there is a single small business in the USA that hasn't had contact with GroupOn, or a single discount shopper who hasn't heard of them through their marketing.

Re: Groupon Plunges as Board Members Reportedly Leaving

#92

Post by MortenK » Tue, May 01, 2012, 2:27 PM UTC

mkr-hn wrote: post #42

tedsuo wrote: post #29

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.

Good place to start: https://www.google.com/#q=pets.com+bubble&hl=en&prmd...

That link lead me to a NY times article from december 2000 with the following paragraph describing the height of the 1999 bubble: "Even the most traditional brokers and investment banks set aside the notion that a company's stock price should reflect its profits and urged investors not to miss out on the gold rush."

That sounds eerily similar to todays climate.

Re: Groupon Plunges as Board Members Reportedly Leaving

#93

Post by omi » Tue, May 01, 2012, 3:06 PM UTC

Zarathust wrote: post #61

OzzyB wrote: post #50

Earlier quoted context omitted.

That's very unnerving if it's true, because, by going along with "Groupon is worth $6bn because Google offered that to us and we turned it down" , implies Google had a hand in creating that extremely high perception before their IPO. If Google did infact have the chance to look at the books (which I'm sure they did), and then allow that "$6bn meme" to circulate -- well, that's evil isn't it?

I was not Google's job of sinking Groupon. It was also every investor's job to check the books before the IPO.

Most IPOs are a bad deal for tech companies with easily replicateable business models. I wonder if P is ready to take the floor out.

Re: Groupon Plunges as Board Members Reportedly Leaving

#94

Post by joering2 » Tue, May 01, 2012, 8:01 PM UTC

hkmurakami wrote: post #70

joering2 wrote: post #43

Earlier quoted context omitted.

anyone would want to invent a time machine for a cool $5 billion dollars?? because that much Andrew Mason would pay you to get back to the table split seconds before he said "no" to Google's "we will pay you $6 billions for your website".

Why would Andrew Mason pay $5billion when the company is still worth $6.83B today? Giving away $5B to get the company's valuation to $6B would only make sense if Groupon were valued below $1B right now. (unless you're insinuating that in the near future, Groupon will be below this threshold, or even in bankruptcy)

its only worth $6 on your favorite stock website, same way as I am telling you this post is worth $100B just because I say so.

By the time they would find someone to buy it (had to announce somehow to find a buyer) and sign all the documents, the stock would be a penny one, with a market cap around $500MM.

Groupon stink before IPO and it will make people shorting it extremely rich, and unless rules of basic math like 1+1=5 or rules of economy won't change overnight, this will be one of the biggest deadpool everyone post-internet era has seen!

I already bought a popcorn.