The rise of the “successful” unsustainable company • Hacker News Board

Re: The rise of the “successful” unsustainable company

#131

Post by api » Wed, Oct 24, 2012, 8:55 PM UTC

knieveltech wrote: post #127

majani wrote: post #68

Earlier quoted context omitted.

That's a rather off-colour reply, it has to be said, sir. First you resort to an absurd comparison in a poor attempt at snark, then you claim that Mark Pincus and Andrew Mason are severely pained by their lacklustre performance on the public markets, without providing any evidence of that. This deserves downvotes in my opinion.

Definitely not up to PG's typical standards for a reply.

I get the impression it pushed a few peoples' buttons because the startup culture likes to think it's morally superior to Wall Street.

Re: The rise of the “successful” unsustainable company

#132

Post by webwright » Thu, Oct 25, 2012, 12:15 AM UTC

patmcguire wrote: post #126

webwright wrote: post #77

Earlier quoted context omitted.

"Because of this, most Groupon clients (the businesses) end up losing money, and never offer a second or third discount via GroupOn." That's false. in Q3/2011, 33% of Groupons merchants were people who were doing it for a second time. That number was up to 56% in Q1 of this year. The deals are getting less lopsided-- $12 for $24 at a restaurant where it's challenging to eat for anything less than $50 is a pretty good…

I don't think you're correct about the cash advance - as I recall the merchant only gets paid when the coupon is redeemed. Groupon keeps the float and the breakage.

Here's a recent state of things... It's a bit of a moving target, but they get a big chunk up front.

http://venturebeat.com/2012/05/07/groupon-tightens-its-payme...

Another thing to realize is that they get the money REGARDLESS OF WHETHER YOU REDEEM IT. EVER. Depending on the type of Groupon, upwards to 20% of them are never redeemed (this is a dirty secret of gift cards, too).

Re: The rise of the “successful” unsustainable company

#133

Post by yuhong » Thu, Oct 25, 2012, 4:50 AM UTC

tesseractive wrote: post #107

ahi wrote: post #104

Earlier quoted context omitted.

Maybe not Mason, but it seems like a reasonable assessment of Lefkofsky.

This. You could believe that Mason was acting in a completely earnest fashion, but was too naive to realize he was being manipulated by Lefkofsky. As Excutive Chairman in a non-operational role, Lefkofsky is under only a fraction of the unpleasant pressure Mason is under as CEO. If he were guilty of behaving in this way, that would actually jibe pretty well with pg's assertion about people not wanting to run struggli…

http://news.ycombinator.com/item?id=4284524 http://pandodaily.com/2012/06/04/source-lefkofsky-and-samwer...

Re: The rise of the “successful” unsustainable company

#134

Post by mlchild » Sun, Oct 28, 2012, 1:01 AM UTC

tptacek wrote: post #95

pg wrote: post #93

Earlier quoted context omitted.

If anything that supposed counterexample supports my point that the accusations these people casually make in HN comment threads are so much more drastic than they realize that they're their own reductio ad absurdum. Running a public company that's a scam tends to entail criminal behavior. Especially nowadays.

CA didn't start out as a deliberate scam, and continues to run today despite being essentially a scam for many years. The companies we're talking about today --- Groupon, Zynga --- don't have long enough track records as publicly traded entities for us to presume they're run in good faith; variants of the things that got Kumar sentenced probably aren't even crimes when they happen during mezzanine funding, when the p…

I believe PG's point is that creating a company as successful as Groupon or Zynga from scratch requires an incredible level of psychological and man-hour commitment, in addition to constant creative and iterative idea generation. The idea that they are pump-and-dump schemes is absurd in light of this essential truth.