My thoughts on Groupon and the recent firing of CEO Andrew Mason were published Friday in Jason Hahn’s DM Confidential article titled, What Groupon’s Firing of Andrew Mason Means for the Company and the Daily-Deals Industry.
On Thursday, Groupon booted Andrew Mason from his seat as the daily-deals company’s CEO, less than a day after it announced disappointing fourth-quarter results and a tepid forecast for the first quarter of 2013.
While less than surprising, Mason’s firing marks the end of an era filled with offbeat humor, bad accounting and controversial Super Bowl commercials.
That said, Mason and his tenure at Groupon did have laudable highlights, including an IPO that was the second biggest for a U.S. Internet company. Groupon also blazed a trail and carved out an industry that countless copycats and innovators benefited from.
Now that Mason has exited the biggest stage in the business (with a severance package totaling $378.36), what does the future hold for Groupon and the deals industry as a whole? We spoke with eight experts to find out.
Here’s what I had to say:
Patrick Lefler, founder, The Spruance Group
“The departure of Andrew Mason may eliminate some of the short-term distractions that were clearly affecting Groupon, but it will not be a catalyst for change in the fortunes of the company. That will only occur when its business model changes. Until then, the company will continue to languish. Having said that, the coupon business is huge and remains ripe for innovation. Just because the Groupon business model isn’t working doesn’t mean the space can’t be conquered. It will just take a different company with a better business model. You can be sure that there are tens — if not hundreds — of startups today that are applying the lessons learned from Groupon’s mistakes to exploit their ‘second-mover’ advantage.”
I do believe that the coupon space is ripe for innovation. Groupon didn’t invent the space, they just tried to innovate it. Poor customer service and a business model that didn’t properly align the interests of its buyers with it sellers clearly hurt the company. Can Groupon rebound with new leadership? I don’t think so. As I said in the interview, it will take more than new leadership to change the course. It will be interesting to watch the space over the coming year as more and more newcomers will enter in their attempt to find the right business model.
And for those who want to read a really great resignation letter, Andrew Mason penned perhaps the gold standard of departure letters. Funny, sad, self-deprecating, yet optimistic.
People of Groupon,
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. From controversial metrics in our S1 to our material weakness to two quarters of missing our own expectations and a stock price that’s hovering around one quarter of our listing price, the events of the last year and a half speak for themselves. As CEO, I am accountable.
You are doing amazing things at Groupon, and you deserve the outside world to give you a second chance. I’m getting in the way of that. A fresh CEO earns you that chance. The board is aligned behind the strategy we’ve shared over the last few months, and I’ve never seen you working together more effectively as a global company — it’s time to give Groupon a relief valve from the public noise.
For those who are concerned about me, please don’t be — I love Groupon, and I’m terribly proud of what we’ve created. I’m OK with having failed at this part of the journey. If Groupon was Battletoads, it would be like I made it all the way to the Terra Tubes without dying on my first ever play through. I am so lucky to have had the opportunity to take the company this far with all of you. I’ll now take some time to decompress (FYI I’m looking for a good fat camp to lose my Groupon 40, if anyone has a suggestion), and then maybe I’ll figure out how to channel this experience into something productive.
If there’s one piece of wisdom that this simple pilgrim would like to impart upon you: have the courage to start with the customer. My biggest regrets are the moments that I let a lack of data override my intuition on what’s best for our customers. This leadership change gives you some breathing room to break bad habits and deliver sustainable customer happiness — don’t waste the opportunity!
I will miss you terribly.
Love,
Andrew
Finally, someone with the guts to admit they were fired as opposed to other CEOs who have trotted out the standard “I need to spend more time with my family” line after their own involuntary departures. The joke here (as Marc Andreessen points out) is that most executives are not liked by their families, who would prefer that they not spend more time at home and try to get them into a new job as quickly as possible.
Well done Andrew!
