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Two For One: Groupon Replaces CEO Mason With Board Members
Originally published on Fri March 1, 2013 5:48 am
Hear Laura Sydell's report for Morning Edition by clicking the audio link.
Groupon co-founder Andrew Mason has been fired as the daily-deal company's CEO, one day after Groupon posted financial results that showed it lost $67.4 million during 2012. Board chairmen Eric Lefkofsky and Ted Leonsis will jointly fill the CEO post on an interim basis.
Shares in Groupon sank by nearly 25 percent to $4.53 at the end of trading hours Thursday, as investors digested the news of another losing quarter and a financial outlook that predicted first-quarter 2013 revenue would fall short of analysts' estimates by tens of millions of dollars.
In a message to Groupon employees, Mason started off on a light note, but he soon acknowledged the troubles the company has endured, as it recorded consecutive quarters of multimillion-dollar losses:
"After four and a half intense and wonderful years as CEO of Groupon, I've decided that I'd like to spend more time with my family. Just kidding - I was fired today. If you're wondering why... you haven't been paying attention."
Mason, well-known for his open and joking personality, later compared his tenure at the company to a charmed session of playing the video game Battletoads. And he asked for suggestions for "a good fat camp to lose my Groupon 40" — a request he later said had met with sufficient responses, via his Twitter feed.
The daily coupon business, seen just years ago as a sector of expansion and fast-growing profits, has struggled recently, due to international volatility and a slide in popularity for daily discounts.
Groupon has also come under pressure from Google, which famously attempted to purchase the company for nearly $6 billion back in 2010.
Announcing the change, Lefkofsky said, "I want to thank Andrew for his leadership, his creativity and his deep loyalty to Groupon. As a founder, Andrew helped invent the daily deals space, leading Groupon to become one of the fastest growing companies in history."
Groupon's board says it will conduct a search for a new CEO.
RENEE MONTAGNE, HOST:
NPR business news starts with a shakeup at Groupon.
(SOUNDBITE OF MUSIC)
MONTAGNE: The CEO of the online discount site Groupon has been pushed out from the company he founded. Andrew Mason's ouster came a day after the company reported worse than expected losses.
NPR's Laura Sydell reports that Mason's exit is no surprise.
LAURA SYDELL, BYLINE: Groupon's stock value has been on a steady decline since it's IPO in November of 2011. It's gone from 20 bucks a share to below five.
CEO Mason was known to be a bit of an eccentric, and his last day was no exception. He posted a letter online that said quote, "I've decided that I'd like to spend more time with my family. Just kidding - I was fired today."
Altimeter Group analyst Susan Etlinger says quirkiness can be a great quality in the leader of a start up - but when it comes to running a public company - not so much.
SUSAN ETLINGER: When you're a startup founder, people expect and want a degree of inspiration. When you're the CEO of a public company what people want is reassurance and continuity.
SYDELL: However, it may be hard for any new CEO of Groupon. Business that offered deals through Groupon discovered providing a discount to get someone in the door didn't necessarily turn them into a long time customer.
ETLINGER: It's giving you people who are looking for a cheaper alternative. That's not necessarily the people that you build a business on.
SYDELL: In his parting letter, former CEO Mason offers this wisdom, have the courage to start with the customer. But, for Groupon, it's not clear if that's the people looking for the discount or the business offering one.
Laura Sydell, NPR news. San Francisco. Transcript provided by NPR, Copyright NPR.