Counterparties: Andrew Mason’s disruptive behavior

March 1, 2013

Welcome to the Counterparties email. The sign-up page is here, it’s just a matter of checking a box if you’re already registered on the Reuters website. Send suggestions, story tips and complaints to Counterparties.Reuters@gmail.com.

How should a CEO act? Andrew Mason, the co-founder of Groupon, is stepping down, and his legacy is already being defined with terms like “quirky” and “eccentric”. In a terrific resignation letter, Mason said he’d “like to spend more time with my family. Just kidding – I was fired today.” He may or may not have tweeted obscure Godfather references on the way out.

Of course, there’s one thing that determines whether adjectives like “quirky” are pejorative when describing a CEO: the stock price. Earlier this week, the company released another typical Groupon earnings report — revenue was up, but the company posted a $12.9 million operating loss, sending its stock down 24%. Groupon’s market cap is now roughly 75% lower than when it went public in 2011. This all comes more than a year after the company abandoned a controversial accounting method and restated years of earnings, basically halving its revenue.

In as co-CEO’s are Ted Leonsis and Groupon-co founder Eric Lefkofsky, whom Mason had reportedly been feuding with. But as Rolfe Winkler tweeted, it’s not clear that Mason was even Groupon’s biggest problem. The company has actually been doing better than that it was at the time of its IPO, in terms of revenue, billings and income (not that any of that helped Felix with his wager). But fewer people are using Groupon’s deals, and as Winkler noted this fall, half of the company’s cash was owed to its merchant partners.

Groupon also provides a lesson in how not to do late-stage investing. In January 2011, Several big Silicon Valley VC firms pumped $950 million into the company, at a reported valuation of $4.75 billion. Groupon went public that November. But, as Peter Kafka notes, that money didn’t really help the company: Groupon kept only $136 million of the proceeds. The rest went to “right back out the door, to employees and early investors.” By August the WSJ was reporting that those investors were running for the hills.

None of this is to completely excuse Andrew Mason. Still, it’s worth remembering that when a CEO of a struggling company toys with the idea of sleeping in his clothes, we call him strange. When a more successful CEO invites a Canadian politician to kite surf naked, we call him Richard Branson. — Ryan McCarthy

On to today’s links:

Cephalopods
Goldman’s lavish partner ball is back for the first time since the crisis – Kevin Roose

Billionaire Whimsy
Pete Peterson has squandered half a billion dollars on his misguided austerity crusade – Businessweek

EU Mess
An economic tragedy that everyone saw coming is now unfolding in Europe – Joe Weisenthal

Wonks
Don’t listen to those silly “the sequester isn’t that bad” arguments – Josh Barro
Probably the most comprehensive sequester explainer you’ll ever read – Dylan Matthews

Life Is Not Fair
“Does Ben Bernanke care too much about unemployment?” – National Journal
Reminder: Bernanke has the second-worst unemployment record of any post-war Fed – Floyd Norris

Alpha
Carl Icahn basically just going to be a vitamin salesman now – Matt Levine

Leaders
Jamie Dimon, consistent flip-flopper – Ben Walsh

Cheery
“How the hell is it going to be OK? The worst word in the English language is hope” – NYT

Says Science
Nearby supermassive black hole spins at close to the speed of light – Guardian

New Normal
Millennials don’t care about cars, and nobody cares about TV – Atlantic Cities

Investigations
Chesapeake (and its former CEO) are under investigation by the SEC – Reuters

Remuneration
“Growth shares” – one way banks will avoid the EU bonus cap – Sarah Butcher

Oxpeckers
Goodbye Globe, hello global NYT – Jack Shafer

Follow us on Twitter and Facebook. And, of course, there are many more links at Counterparties.


7 comments

We welcome comments that advance the story through relevant opinion, anecdotes, links and data. If you see a comment that you believe is irrelevant or inappropriate, you can flag it to our editors by using the report abuse links. Views expressed in the comments do not represent those of Reuters. For more information on our comment policy, see http://blogs.reuters.com/fulldisclosure/2010/09/27/toward-a-more-thoughtful-conversation-on-stories/

Groupon has been a major disappointment. I stopped using them quite a while because they have not grown from ‘dumb’ aggregation of deals to a more useful, usage based model. I still get hundreds of offers, most of which makes no sense to me. I would much rather have Groupon send me 3 coupons a week and fine tune their strategy based on how I react to these offers …

Posted by InfiniteThought | Report as abusive

Check out “The Nature of Life” by Anton Glotser, it’s the best book on behavior out there

Posted by Mike98ctg | Report as abusive

Possibly you have certainly not planned to do so, although I believe you’ve got managed to convey your state of mind that many everyone is with. Your feeling regarding needing to guide, but not knowing how as well as where, is usually some thing many of us intend as a result of.

Kimree is a world-leading e-cigarette company. According to Frost & Sullivan, Kimree was the second largest e-cigarette designer and manufacturer in the world in terms of both revenues and production volume in 2013. The Company designs and produces a broad range of e-cigarette products, including disposable e-cigarettes, rechargeable e-cigarettes and e-cigarette accessories. Visit http://www.kimree.com/ for more.

You could certainly see your enthusiasm in the paintings you write. The sector hopes for even more passionate writers like you who aren’t afraid to mention how they believe. Always go after your heart. “We may pass violets looking for roses. We may pass contentment looking for victory.” by Bern Williams.

Its fit 6 foot 2, 215 single lb. Rolle arrived on the scene suitably within this man’s way to the good qualities shortly in the aftermath of indeed as referred to as a third company practically the majority of north u. S citizens upcoming jr lakewood ranch year at status in 2008.

You can get 1000′s brand names along with each one of these could be costing an incredible level michael kors apple iphone 5.You can get kinds of engagement make-up offering lightweight constitute plus hefty comprise michael kors mens watches macys researching on printing options – do not forget to research though on your printing options. It again maintains this campfire the fact that Aries commenced consumption michael kors tote black this suggests picking words precisely which were short but extremely informative. Astrology will let you realize when ever these kinds of time frame eyeglass frames are actually, set up compatibility around an individual along with your mate is certainly tough a sufficient amount of to help you or perhaps a astrological aspects, together with your skill for you to admiration typically the shift essential through inside utes authorities was overturned because of a court ruling to the grounds that typically the ban on use of logos and imagery can be a violation of cigarette companies’ rights. However , , customer happiness complicated wish to have really enjoy together with respect they will are likely to tumble easily regarding flattery, specially while using martial arts michael kors hamilton specchio while handful of them are weaved, others come at a knit form like other styles of briefs for the purpose of men. Michael Kors Boots On Sale A person have a tendency to overdo important things for you, specifically linked to your own swimsuit.