Do we have to explain AGAIN to those of you that think paper worth = money? Haven't we been through this as early 20 somethings that appeared to be millionaires on paper based on stock options- POOF, it's gone!
Have read way too many of the recent articles hailing Groupon as the latest Microsoft/Google/Facebook. If you are an investor- you are nuts, out of your mind! Groupon has absolutely no control over the coupons that it offers. For instance, I took over a space on Mass Ave in Arlington that was previously occupied by another pilates studio when I opened in Jan 2010. The previous studio owner offered a Groupon in October 2009 that sold to a couple hundred people KNOWING THAT SHE WAS GOING TO CLOSE THE STUDIO! She pocketed the money and buyers were left with nothing to redeem. She told Groupon that I was going to honor the arrangement- I didn't even have the equipment to do so! She lied to them, sold classes knowing that she was not going to be able to honor them, took the check, cashed it and kept it. Groupon was left refunding the cash after it had already paid her. And this was when they were still selling to hundreds, not thousands! From Groupon, there was no investigation into the company by Groupon, they called one day, asked her to do it, she did and then she bolted. It looks all well and good and the numbers that they are reporting are impressive, but you cannot have a company that is completely dependant on the customer service of others that you have not worked with to develop trust and a relationship. There's a restaurant up for sale in Wellesley today December 9th that ran a Groupon on November 24th. Am surprised so many folks are stupid enough to think this is a viable business model. Will completely collapse within the year. As a consumer- hell yeah, there are some great deals- if I wanted to throw some $100s on the fire to deal with upcoming lawsuits and unsetted transactions, then I would be an investor. Groupon needs to get a little more picky about who it does business with and not just, and a direct quote from them when I spoke with them in the spring, "by looking into the Yelp and CitySearch reviews of the businesses that we choose to work with". Oh, there's a stellar way of understanding business practices- I wrote a yelp review as I was sitting at the bar waiting for takeout and commenting on the behavior of the bartenders of a local restaurant-yeah, I have an MBA and had some good points, but the dude next to me, not so much!