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February 2013




February 28, 2013 – Comments (0) | RELATED TICKERS: GRPN

Andrew Mason resigned less than an hour ago and he was humble in his assessment of his shortomings and the mistakes he made. That said, he made out really good at the IPO and will likely not ever have to worry about making rent. [See his farewell email below] Groupon as a business was flawed from the start. When I first heard of it along with others like LivingSocial, I expected a platform that would aggregate and organize all the deals, coupons, sales and clearances out there into a format and user interface that would be easy to navigate, even for my grandma. But alas, Groupon went ahead to compel mom and pa shops to offer deals to its growing hordes of subscribers at the expense of course, of the small businesses. At one point it almost seemed obvious - why not offer the businesses an interface where they could create their own deals and coupons along with limits on how many they could manage and offer their subscribers insight into these deals? They could have taken a small royalty on every coupon cashed in and thus transform themselves into a Google for Deals. Easy to say in hindsight. Andrew Mason was a pawn and the new CEO is no stranger to controversy. I am thinking of playing this in an interesting way. I will wait for the euphoria on the new developments to subside, watch to see if they develop a practical and sustainable business model, then consider the option strategy - Puts if they continue on the same path and calls if they seem to be learning. Regards, FAREWELL EMAIL 

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