Groupon Now Down 78% From Its November IPO Price

The daily deals site has verifiably tanked on Wall Street.

andrewmason.jpg

Groupon CEO Andrew Mason, perhaps on his way to the bank (Reuters).

Yikes, after Groupon reported its second-quarter revenues, the company's shares have nosedived in after-hours trading. As I write, the share price is down to $6.15, or 78 percent off from its IPO price of $28


Of course, Groupon insiders have already cashed more than $800 million out of the company, so perhaps they aren't so worried about the company's current performance. 

It is perhaps unfair, however, to group Groupon in with Zynga and Facebook. The business model looks a lot more like a traditional offline business, sort of like a yellow pages with a teensy-weensy bit of social added to the mix. The name of the game is selling thousands and thousands of local merchants on the idea that a breakeven or loss-leader promotion will lead to the long-term improvement of their businesses. That's always been a risky venture.
Presented by

Join the Discussion

After you comment, click Post. If you’re not already logged in you will be asked to log in or register with Disqus.

Please note that The Atlantic's account system is separate from our commenting system. To log in or register with The Atlantic, use the Sign In button at the top of every page.

blog comments powered by Disqus