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Groupon…..What a Bust

Groupon the darling of the social media buyer groups listed this month and it has been a bust. The stock is now trading at a substantial discount to the IPO. Granted the market has been crap but Groupon has been crappier

 

I have written about this phenomena before and the questionable strategy of Groupon not taking the $5.3 billion that was offered by Google. My feeling is that this was one of those once in a lifetime deals that has now past since the market has given a firm valuation to Groupon and by extension all other companies in this field.

This now makes James Packers decision to drop $40 million into Scoopon the domestic equivalent of Groupon not that clever. Although I am certain that Packer would not worry too much about dropping $40 mil.

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Comments

  1. You see this often. Some one or group starts a business and after a while they get an incredible offer for it. Rather than realizing they just got lucky they think they are smart and hang on.

    The second form of this group are the ones who do sell and then blow away the money on one unsuccessful venture after another

    the final form of the group, sell, and realizing they just had the equivalent of a lottery win, retire gracefully and spend each afternoon on the deck of their yacht drinking pink gins inthe sunset

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