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Groupon Buys LivingSocial, a Rival Once Valued at $6B

194 点作者 kpeel超过 8 年前

11 条评论

dmerrick超过 8 年前
Back in 2010 I worked at a startup that ended up pivoting to a regional Groupon clone. It seemed like a good idea at the time, but the company ended up going under a year later.<p>What I remember most vividly was trying to come up with a good name. LivingSocial was starting to get traction and we wanted to differentiate ourselves from them. The conversation went like:<p><pre><code> Boss: What&#x27;s the opposite of LivingSocial? Me: I dunno, DyingAlone?</code></pre>
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pchristensen超过 8 年前
I worked at Groupon from 2010-2012. I realized that a lot of the problem with the daily deal industry was that a) there was only going to be one winner, because of network effects, and b) no one knew how big the prize would be for being the winner, so it was not clear how much $$ to raise or spend to make it worth it. It doesn&#x27;t matter how much you spend on a war if you lose.
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jseip超过 8 年前
As a former LS employee, I don&#x27;t know what stings more: the immaterial amount of the transaction, or the 11% after hours plummet.
dannylandau超过 8 年前
Daily Deals are great for one type of business -- Dental offices! I used them a few times for to get discounts on cleaning. The incentive to bring new customers by offering steep discounts is definitely worth it for those type of vendors.
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danso超过 8 年前
&gt; <i>The amount of the purchase isn’t material, and the transaction should close next month, Groupon said Wednesday in a statement. Amazon.com Inc.-backed LivingSocial had cut more than half its workforce in March, part of a downward spiral from the headier days of 2011, when it was valued at $6 billion in a funding round.</i><p>For a company of Groupon&#x27;s size ($3B annual revenue), that doesn&#x27;t necessarily mean that it was free, right?
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downandout超过 8 年前
Does anyone know what the threshold for an &quot;immaterial&quot; transaction is in the case of Groupon? I&#x27;m trying to at least get a sense of the price.
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trollied超过 8 年前
Groupon still exists? I am surprised.
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danvoell超过 8 年前
Very interesting. The fact that Groupon buys a rival for pennies on the dollar sends the value of Groupon down 14%. Assuming people see this low purchase price as some sort of validation that the model doesn&#x27;t work? Typically you would see this type of transaction as Groupon gaining more pricing power in the industry. Groupon might have been better off just letting Living Social ride off into the sunset.
cheriot超过 8 年前
I was really hopeful for what a LivingSocial IPO would do for the DC tech scene. That many dev, design, and product people looking to start their own thing with the DC talent pool to draw from... Maybe next time.
juhq超过 8 年前
Whoah Groupon is still around?
qwrusz超过 8 年前
While Groupon is not exactly known for their financial filings accuracy. This acquisition is weirder than usual. There seems to be no official press announcement instead Groupon added basically just this one line in their 20-page long 3rd quarter earnings press release:<p>&quot;On October 24, 2016, Groupon entered into an agreement to acquire all of the outstanding shares of LivingSocial, Inc. The acquisition is expected to close by early November 2016, subject to satisfaction of customary closing conditions. The acquisition consideration is not material.&quot;<p>For those comments questioning the <i>&quot;not material&quot;</i> part. I agree this looks like a potential legit issue: The price paid is probably somewhere in the 8 figures. But regardless of price, Groupon is a small company that doesn&#x27;t make any money (they just announced they lost $36 million last quarter alone), so even a small purchase price, not to mention LivingSocial&#x27;s future expenses, can be very material.<p>But more important than a debate over acquisition details and what is &quot;material&quot;: Groupon management have been accused in multiple different lawsuits in recent years for <i>making untrue statements or omissions of material facts</i>. And they lose&#x2F;settle for millions of dollars.<p>Innocent until proven guilty but if one reads further down to management&#x27;s &quot;Outlook&quot; section of the press release it is very odd to see LivingSocial mentioned here:<p>&quot;Outlook: Groupon&#x27;s outlook for 2016 reflects current foreign exchange rates, as well as expected marketing investments, stabilizing trends in Shopping, <i>the acquisition of LivingSocial</i>, potential disruption related to country exits...Groupon is raising its revenue guidance range...and narrowing its expected 2016 Adjusted EBITDA range to between $150mm and $165mm&quot;<p>If something is not material then how or why is it one of 6 things listed as reflected in the company&#x27;s outlook??? Why even bring it up again?<p>Things that have an effect or get reflected in a company&#x27;s outlook and guidance is material. Even in the most generous definition of material this is material.<p>I am not saying Groupon needed to disclose price paid or give a full biz synergy plan. But what is LivingSocial? Is it a going concern? Is this accretive or dilutive? Asset or liability?<p>This acquisition deserves more information than was provided and should not have been labeled as &quot;not material&quot;. The stock&#x27;s AH 10% drop feels very material to investors.<p>Groupon&#x27;s 3Q2016 Press Release: <a href="http:&#x2F;&#x2F;investor.groupon.com&#x2F;releasedetail.cfm?releaseid=995675" rel="nofollow">http:&#x2F;&#x2F;investor.groupon.com&#x2F;releasedetail.cfm?releaseid=9956...</a>