Groupon CEO Andrew Mason Fights to Keep His Job

After Andrew Mason founded Groupon in 2008, companies like Google and LivingSocial rushed to imitate the daily deal business he created. Less than five years later, the allure of discounted spa packages and wine-tasting classes has faded. With the company’s board and other co-founders losing patience, Mason is betting on early-stage, low-margin businesses to turn Groupon around—and save his job.

The value of daily deal coupons sold by Groupon grew from $745 million in 2010 to $4 billion in 2011. But growth has slowed, with the value increasing to an estimated $4.2 billion in 2012, according to Evercore Partners. Evercore predicts it will decline 38 percent, to $2.6 billion, this year. The company’s stock price has fallen more than 70 percent since it went public at $20 a share in November 2011. Daunted by the deteriorating business model, sluggish international growth, and a series of accounting missteps, investors have shaved more than $13 billion from Groupon’s market value in 14 months—one of the worst IPO runs since the dot-com bust. The company is now valued at $3.3 billion, a little more than half the amount Google offered to pay for it in 2010.