Is Groupon In Trouble? And Is It Andrew Mason’s Fault?
1:21 pm, August 31st | by Hillary Reinsberg
Groupon founder Andrew Mason is a goofy, quirky 20-something who runs a multibillion-dollar company. He’s not alone in this category, but, some would argue, he’s struggling with it more than the others. After two top execs quit the company unexpectedly and a bit of a beating in the press, Groupon is not quite basking in the glory of a few months ago. Is it Mason’s fault?
A little rundown: First, Groupon’s head of sales was replaced without much explanation. Then, last week, in the midst of some media scrutiny, Mason fired off a cocky missive to staffers, proclaiming “the degree to which we’re getting the shit kicked out of us in the press had finally crossed the threshold from “annoying” to “hilarious.” The takeaway of the email is basically that Mason thinks Groupon is still an awesome business. There’s nothing wrong with boosting a little company morale, but it was technically the “quiet period” of Groupon’s IPO. Some argue that Mason knew that the email would get leaked and picked up all over the web (which it did, of course), thus, well…making a PR mistake. A few days later, Groupon’s new head of PR, who’d been on the job just two months, quit, without much explanation.
So, there are two questions we need to keep our eyes on:
1. Is Mason right in saying that Groupon is really a-okay? In the letter to staff, Mason wrote, “In other words, all the stuff that one would want to look good? It looks good.” Does it look good? Eh. Growth was way down in the second quarter, which drove the privately auctioned shares down around 20 percent. In the letter, he says numbers are on the way back up now. So. We’ll see.
2. Is Mason’s blasé — or, you might say, cockiness — a slippery slope for the company? For now, this one’s harder to answer with facts and figures, but if investors get worried and start pulling their investments, the effects of Mason’s attitude could very well end up on the balance sheet.