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The founders and early investors have all cashed out, they invent accounting metrics. When you look at the actions of their management team and combine it with
by fleitz 15y ago
The founders and early investors have all cashed out, they invent accounting metrics. When you look at the actions of their management team and combine it with weird accounting metrics, it would be more aptly named Grouponzi.
It isn't a lack of business accumen, divesting yourself of a business at the height of it's market cap is the right thing to do. The problem is that in order to do sell at the highest price you need to convince someone else that the business will be worth even more in the future. For being able to do that he is a brilliant business man.
If pouring cash into this business would make it profitable then why did 90% of their Series G go to cashing people out? It seems to me that if Andrew Mason believed what he says then he'd go all in and take a modest profit to secure himself for the rest of his life. Instead he sees what everyone else sees which is a business about to tank.
- pbreit 15y agoSo when is the right time for an executive to take money off the table? Ever? AirBnB founders took money off the table. Is that a bad sign for it? Founder liquidity is not rare.
- fleitz 15y agoWhen it suits them, it doesn't matter to me, I could care less if an executive can convince someone to take their stock off of them. Taking 'like a billion dollars' in liquidity when your company is bleeding cash does not engender me to believing that the management team sees long term viability in the company. Groupon is built to flip, if you're a trader a stock like groupon is perfect, there will be lots of volatility to trade on. I'm not a trader, I believe in creating long term value. Groupon might be the kind of thing where a guy like Buffett could take advantage of the cash flows it generates to build a bigger better Berkshire. http://www.youtube.com/watch?v=5ydqjqZ_3oc http://www.youtube.com/watch?v=5ydqjqZ_3oc This is fundamentally the best explanation of the groupon business model.