Groupon, the world’s most famous deal-of-the-day website, has said goodbye to its COO and to half of its turnover on the same day. Groupon’s number two, Margo Georgiadis, has left the group coupon distributor for Google, whereas the SEC urged Groupon to recalculate their turnover and profit figures in a less favourable way.
Short life span for Groupon COOs
Georgiadis lasted only five months as Groupon’s COO, having arrived there from Google last April when she left her place as Google vice-president of sales. Georgiadis took over from Rob Solomon, who also lasted only one year as COO under Groupon founder Andrew Mason. In her old and new home Google, Georgiadis will take care of the Americas. FT quoted an employee saying differences in strategy caused Georgiadis’ move away from Mason.
Mason claims that the new shuffle at Groupon’s top will not compromise the strength of the company – he will now take over a significant part of the COO’s responsibilities. Nevertheless, pressure on him keeps growing.
New calculation cuts 55% off Groupon turnover
A part of that pressure comes from the long and hard path to Groupon’s flotation, which Mason wants to happen sooner than later as the financial markets seem to have lost their appetite for internet companies – and especially social media. Mason always hoped for the transaction to raise $ 25 to 30 billion (between 18 and 22 billion euro), but saw the company’s worth decrease after the publication of new financial data.
En route for its initial public offering, Groupon was forced to recalculate their sales and profit figures, counting only the fees paid by merchants (as opposed to counting the complete value of the coupons) and effectively reducing turnover by over 50%. While the group claimed to have a $1.52 billion sales figure for the first half of 2011 (roughly 1.1 billion euro), Groupon suddenly announced that figure to be only $688 million (0.5 billion euro). It is unclear so far how these new figures will impact Groupon’s flotation, which was scheduled for this autumn.