They Turned Down $6 Billion From Google, Now They're Broke

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In this video, we explore Groupon's incredible rise and fall. Once the fastest growing company ever, Groupon turned down a $6 billion offer from Google in 2010, confident of even bigger success. They then staged a record-breaking IPO in 2011, only to face a steady decline since. With a 60% drop in active users and 80% drop in revenue, Groupon's market cap now stands at a mere $200 million, less than 5% of Google's initial offer. How did this happen? Join us as we unravel the tale of Groupon's precipitous rise and its long, painful fall.
0:00 - 1:12 Intro
1:13 - 4:41 Growth of Groupon
4:42 - 8:22 A shady IPO
8:23 The decline
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#Wallstreetmillennial #groupon
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@wallstreetmillennial 11 ай бұрын

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@sotonin 10 ай бұрын

nobody is buying that garbage. stop selling out.

@StephenGillie 10 ай бұрын

This video could have been just 3 minutes long. But monetization.

@minimalistic_banhaus 11 ай бұрын

A customer you get through a discount is much worse than a customer obtained through normal advertising. More price sensitive and more concerned about maximizing the value they get from their purchase.

@null6075 11 ай бұрын

And the percentage Groupon takes from the business!

@tonycrabtree3416 11 ай бұрын

Correct. Only discount old inventory or when trying to prop up the books prior to a sale of business.

@TheGahta 11 ай бұрын

Yeah though its like most things not that clear cut. In germany supermarkets regularly sell meat at a discount (unadvertised i mean) and gets its cut with the other stuff people buy. Though i admit groupon would be a bad fit even in that case, but if you discount x and can be reasonable certain you sell more of y too you can try that

@spicy_xinger 11 ай бұрын

100% thats why luxury brands rarely ever discount and they have a cult following. if you can build a brand that people are loyal to, you dont have to rely on gimmicks

@TheGahta 11 ай бұрын

@@spicy_xinger you would be a fool if you think luxury stores dont give "discount" aka "we just overcharge a bit less then usual" to frequent customers Its powerful psychology

@ljohnson1908 11 ай бұрын

I stopped using Groupon because some merchants would be noticeably upset when you mentioned having one. I once had to get a credit when the merchant refused to let me book a yoga session using my Groupon. She said it "wasn't worth" her time. Later I found out how little money the business makes when partnering with Groupon. However, surely that shouldn't be taken out on the customer.

@stefanietaushanoff3079 11 ай бұрын

I liked it at first but there was a pretty obvious point where it stopped working for the merchants. The "offers" started getting weird and unattractive and a couple of times I bought a groupon only to find I'd basically prepaid for something at a normal price but now there's restrictions on redeeming it. At the end everyone involved was cranky.

@joseornelas1718 11 ай бұрын

30 of those a day Can be a real pain

@middleagebrotips3454 11 ай бұрын

Groupon is fine to sell extra capacity and ONLY for extra capacities, thus the restrictions.

@theakinyemis2244 11 ай бұрын

100%! Some restaurants would have separate menus or even who “sections” for Groupon diners - the stigma and attitude from merchants is what eventually put me off

@jbranche8024 11 ай бұрын

Few times I used one you had to make sure to read the limitations and restrictions. It was to much work. Used it mainly to test different businesses to see if they had a good product.

@jonathanj8303 11 ай бұрын

Groupon had a real big push here (I'm outside the US) a few years ago and then basically disappeared. I think a large part of that was that they were consistently misadvertising deals - you'd buy a groupon deal for 2for1 on meals, and when you turned up, the actual deal with the restaurant was free starter if you bought a full price main, or free drink refills, something like that. Every single one we bought was like that, they were never as advertised, and I was shown enough of the merchants' contracts to be convinced it was groupon lying. Sometimes the merchant honoured the coupon as written, sometimes they stuck to what they'd actually offered. Stopped buying the coupons because it left a bad taste, groupon were obviously just ripping everyone off. I'm guessing most merchants felt the same way because they just disappeared. Good riddence.

@stavas05 11 ай бұрын

The samwer brothers are responsible for that

@robertewalt7789 11 ай бұрын

I used some good Groupon deals back maybe ten years ago.

@jonathanj8303 11 ай бұрын

@@robertewalt7789 yeah, but what I'm saying is that Group were selling more for the price than the merchant agreed to. And then leaving the merchants to deal with the upset customers that groupon had lied to. That's fraud. Plus the merchants were getting totally ripped off, so they stopped using groupon.

@mrb152 11 ай бұрын

The glory days of groupon were amazing. No gimmicks at all. Just pure massive discounts.

@eudofia 11 ай бұрын

Yep, I have at least a $100 in Groupon coupons that I can't use anymore. I bought a 50% coupon for pest control, only to be told by the company that it was only for new customers. As I had used the pest company before, I had to acquire the service for a full price. And I couldn't and have not been able to use the coupon till date. Same with a lawn fertilizer program. My coupon was only valid a 50% off the first treatment if I bought a one-year subscription.

@chewie94116 11 ай бұрын

As a merchant, Groupon was RIDICULOUS AND COMPLETE WASTE OF MONEY. When we gave 50% off, the company would take 50% of the selling fee. So in reality, we were losing 75% off the actual price instead of 50%. Then having the same customers come back, expecting the same 50% off groupon price is unsustainable as a business. When we told them the regular price which they already knew, they said- "No, I will just wait for another groupon deal from either you or your competitor". Lost thousands of dollars to Groupon and never made even $100 back.

@roguewavecreative 3 ай бұрын

Groupon was a weird study in consumer behavior. The avg income of groupon users was surprisingly high. They were deal finders. The prob was these were not people that would come back. This hurt alot of small businesses and over time they stayed away and groupon slowly went down.

@irfuel 11 ай бұрын

Groupon did not get the businesses new customers. We tested Groupon. The only people you get in the door are Groupon shoppers. They use the deal (which costs you a lot of money) and never come back. I think not even 1% of those Groupon customers came back to pay full price for anything. And then the hoops you had to jump through to get your deal removed from the platform ... never again.

@experimex 11 ай бұрын

@@CheapSushii assume they’re a business owner with inventory capabilties

@chewie94116 11 ай бұрын

I agree with you 100%. Same thing happened to our company.

@jacobitosuperstar 10 ай бұрын

as a groupon customer, the thing is that the deal seamed so sweet when taken, the normal price looked awfully expensive. And the more expensive the business, the more incentive there is to only go there with the groupon discount. Was great while it lasted. Visited a lot of expensive places with pennies on the dollar. Good Riddance.

@swagdaddyify 10 ай бұрын

Groupon catered to broke people. You never should've expected a returning customer when the only reason they showed up in the first place is because they felt they were "getting one over" on you with such a good deal.

@KinGizzard 11 ай бұрын

What made me stop being a Groupon? Groupie was that they were sending out anywhere from 5 to 8 emails every day. That was just way too ridiculous.

@oicfas4523 10 ай бұрын

Similar for me. The deals also started to get really useless and things I'd never be interested in. Felt like spam so I just unsubscribed.

@Angelstar7774 11 ай бұрын

Every time I went into a business saying I heard about them through Groupon they would beg me to pay them directly instead of through them

@MarkL-we8uk 11 ай бұрын

I was offered a sales job with them back in 2012, deluded company with lots of jumping though hoops - interview with HR, then some sort of test, interview at head office with some guy who was on some TV show - an Irish giy called Jim (they were upset I didn't know who he was) sales manager and HR manager who I had previously interacted with. All this happened in a couple of days. Then radio silence for a week. I focused on other opportunities and got a job elsewhere. Week later the HR manager called saying they would like to oofer me the role. I never responded.

@jcman240 11 ай бұрын

Dentists & car repair shops used to love these things. Give a heavily discounted cleaning/oil change then present an estimate for a bunch of other (probably unnecessary) work. Gag was up when they realized the majority of Goupon users are broke.

@CliqueOverAnything 11 ай бұрын

Or they're very price sensitive haha, I am only going to that location due to it being on groupon

@sentinel151 10 ай бұрын

😂😂😂

@cactusjackNV 10 ай бұрын

@@CliqueOverAnything This, some of the most wealthy people I know use coupons incessantly. Think about it for a sec, if you're broke you can't even afford groupon.

@Zero11_ss 10 ай бұрын

Dentists are so shady, never trust them because so many are bad. I had one telling me I need a tooth removed when i was like 25, refused and asked for other options and suddenly there was other things that could be done. Total joke.

@loupasternak 9 ай бұрын

@@Zero11_ss a dentist looks into your mouth , and sees a gold mine

@earthdog7900 11 ай бұрын

I read a lot about the high user Groupon users, people who would not go back to a restaurant without a deep discount. They would just go to the next groupon deal, not a sticky customer.

@KameraShy 11 ай бұрын

That is the general risk businesses face when they, themselves, continually offer coupons, discounts, etc. as incentives. Problem is that customers get used to and expect those prices, so the business gets caught in a bind. Thinking of the old BBY coupons every month for 20% off.

@Altirix_ 11 ай бұрын

usually customers that look for good deals are "cheap" sure your food is good but theres many good restraunts. the point is they are there for the good deal. it was always going to be hard to get that customer back at a significantly higher price than what they got with the groupon voucher. 50% off at some retraunts could easily be a family food costs for a month.

@terrie001 11 ай бұрын

I would do that. I only go with the discount. Wont likely go again next time without a coupon.

@Khigha87 11 ай бұрын

Greed! 50% of revenue is insane and obviously unsustainable. Talk about grinding the hand that feeds into dust. I really loved Groupon and I used to look forward to their daily deals and emails. It certainly made so many things more accessible to me. From trying new eateries to new experiences like shooting range packages, hot air balloons, horse riding, dance and painting classes. It did a lot to bring attention to small businesses I would have assumed were out of my budget. They didn't realise where their value lay. 50% of revenue from your vendors (a lot of which are small and growing businesses) and turning down $6B is the epitome of greed.

@Sirfrummel 11 ай бұрын

I never understood the Groupon business model. In 2015 I met some Groupon developers at a Google hackathon, I was a new web dev at the time and I was excited to talk to this team from such an enamored company, but the question that was burning on my mind was "How does Groupon make money?" I was just so confused. They said by guaranteeing a number of discounts sold to merchants, but even with their explanation back and forth it never lined up for me, so I mentally noted to never work for the company... And here we are lol

@arnezbridges93 10 ай бұрын

To be fair, this is the same model used by Amazon, Google and Facebook before they switched to Business 2 Business advertising. Amazon still doesn't make I profit I think.

@abcde4677 10 ай бұрын

Their profit model is relatively easy: take cuts from each transactions. But merchants ultimately decided it wasn't worth it for them to sell it at discount when shoppers would not return to the store without discounts.

@hellosammy4105 7 ай бұрын

@abcde4677 But that doesn’t quite make sense either. Coupons are still a thing even without groupon. If that was the norm, then the whole practice would have died out. But businesses now still issue coupons.

@abcde4677 5 ай бұрын

@hellosammy4105 obtaining actual physical coupon vs. buying it on the app is a whole different experience. Former is much harder and takes work while latter is much easier and convenient.

@totesmcgoatz3365 Ай бұрын

@@hellosammy4105printed coupons have less reach and don’t cost you an additional fee beyond printing and processing. I’d say the ideal usecase for Groupon is fairly niche. You have excess capacity you want to get rid of for something vs nothing. The cruise example was a great one. Another is a restaurant that has high swings in foot traffic so you limit your Groupon to your downtime to break even and keep staff busy before your typically heavy period

@slodoco 11 ай бұрын

Think of yourself as café owner. You have a special drink that is on sale with a Groupon. These Social Coupons ran for a day. The place is flooded with people and you run out of the item after an hour of intensive work. The deals were so good, that they attracted all the wrong people, and it made your regular customers despise you because they couldn't come to your café in a steady state. And those other guys getting a freebie or a deep discount? Well, you never saw them again. There were articles about store owners getting burned by this all over the internet around 2010/2011. It's good for a brand new shop, perhaps. But even then you can just hand out coupons on the street, no big deal. I think the shops that signed up with Groupon got burned in the end more than they needed to or prepared for.

@basdfgwe 11 ай бұрын

A friend had a restauraubt cafe, got caught up in the hype and signed up to groupon. Made a massive loss.

@kpectbi 11 ай бұрын

I think the business model was wrong. Instead of draconic cut, they should have provided merchants coupon service platform, and take a small percent, e.g. 10% / minimum fee per coupon purchase. It would eliminate merchant churn, and allow freedom of various deals of coupons.

@BaoNguyen-un1km 11 ай бұрын

Groupon was a HUGE loss from a merchant stand point. We used Groupons at our business at one point but WE WILL NEVER USED THEM AGAIN. They were quick to put up the campaign but you can’t get a hold of them when you want to take down the campaign. We loss our butt off with them

@Dablooo356 11 ай бұрын

Former user here: merchants killed Groupon. I distinctly remember several times trying to use a Groupon that was flat out rejected or told I could only use it on a full moon on a 5th Tuesday during a meteor shower during an earthquake. Merchant purposely making it impossible to redeem and Groupon not having customer service or refunding. Would never use again.

@jeffsetter213 11 ай бұрын

As a merchant back in the early 2010's I was pitched GroupOn. 2 minutes in, I interrupted the flowery talk about generating new customers & future sales and asked about the fees. 30 seconds later I was laughing and hanging up the phone.

@henrytang2203 11 ай бұрын

I always saw Groupon's business model as a way to make other businesses lose money faster. The only exception was reselling goods from Ali at 500% cost price then accepting a 75% markdown leaving you with 125% gross or 25% profit.

@xiaoka 11 ай бұрын

Yes. This. If you have a 90% margin and untapped capacity…. It’s not that bad a deal.

@vickiephelps5169 10 ай бұрын

I loved Groupon. I sold classes for 25% of inflated face value. Most of the Groupons were purchased as gifts and groups. Less than 10% of the coupons were redeemed in the 6 month expiration window. After the expiration date I had sold 6,000 classes for $36,000. I also under sold the coupons during the classes. Only 600 were redeemed, so the pure profit was over $30,000. It was a very good year for me.😊😊😊

@bubba99009 4 ай бұрын

Yea curious how many go unredeemed. It has to be a high %, especially for services. Food probably had a much higher redemption rate but still nowhere near 100%.

@CategoricalImperative 11 ай бұрын

"no need to advertise to our customers again". As a business auditor, these are famous last words of a dying company. I did good selling calls on this company over the years.

@kebuhrogers 11 ай бұрын

I used to use Groupon to get a discount at the place I was already visiting. So that business lost a huge amount of revenue. A business owner told me that they stopped using Groupon because the deals expire. That meant hundreds of people would come in on the day or days before expiration, far more than the business could service. Many customers left, others saw the business as slow and would not return as a result. Oops

@QthePhysicist 11 ай бұрын

I can't believe they didn't sell for 6 billion. That sounds like pure greed to me. Or someone was behind the scenes telling them to go public and they'd make 10 billion or whatever. That person would have had some shares in the company that they dumped on day 1. Sounds like a pump and dump to me.

@JillC 11 ай бұрын

Early on, Mark Zuckerberg was offered 1 billion for Facebook & didn’t take it.

@soulmate805 11 ай бұрын

I don’t think it’s greed. Sometimes you move up so fast, your ego gets in the way of processing reality.

@chlq35 10 ай бұрын

all IPO are pump and dump

@cactusjackNV 10 ай бұрын

Me thinks Google spread around "rumors" about the company after the deal went south. But Groupon in the end shot themselves in the foot.

@redMaple_QC 11 ай бұрын

I used Groupon as a service provider to started up my client base. I stop as soon as I could because the fees were just too much. They were greedy and paid for it.

@xiaoka 11 ай бұрын

I had a friend who had a froyo place that did a successful deal. Thousands of buyers. For him it was ok because his margins were like 80% and the Groupon deal users had to pay extra if they went over the max weight limit, so he managed to make a lot more off of those “captive” customers who were already in line and had their overfilled froyo cup and toppings slowly melting on the scale. Their stores were not usually full, most of their business was takeaway, so there wasn’t a negative impact on their regular sales.

@xiaoka 11 ай бұрын

I also knew a girl who worked in sales (store deal recruiter) for Groupon. She said they’d be fired if they didn’t close at least one deal every two weeks. Regardless of how much sales you drove. Very cut throat.

@veryhuman7472 11 ай бұрын

tf is a froyo?

@dinglshingle 11 ай бұрын

@@veryhuman7472 a dish from tolkiens fantasy novel "the lord of the rings", named after it's protagonist, the hobbit Frodo. you should try it, hobbit food is known for its deliciousness

@xiaoka 11 ай бұрын

@@veryhuman7472 frozen yogurt! 🤣

@ALCRAN2010 11 ай бұрын

@@dinglshingleha

@mirzaahmed6589 11 ай бұрын

6:17 literally everyone knows what Band-Aids are, and regularly buy them preemptively in case they have an injury. No one has had to be sold on Band-Aids for years, and no one needs to be constantly reminded that they exist.

@egal1780 11 ай бұрын

Now we just need a masterclass for how to do this ourselves, i.e. creating our own "tech" startup and sell it for billions to some fearful and/or optimistic tech company. It's simply absurd what gets financed, what they're willing to buy and for what prices...

@toolbar12423 11 ай бұрын

No Masterclass is going to get you there (if they claim to, they're lying). This is all just executing an idea in a way that will actually net you profits or a disgustingly valuation when someone buys you off. How you execute that idea is up to you but it's gotta be done right.

@egal1780 11 ай бұрын

@@toolbar12423 Don't worry, It was meant in a sarcastic exaggeration.

@jonasbaine3538 11 ай бұрын

Step one is befriending venture capitalists

@egal1780 11 ай бұрын

@@jonasbaine3538 though I feel like in 2021 that would've been way easier, theoretically speaking

@TheGreekSneak 11 ай бұрын

Uber has LOST almost 10 BILLION dollars (net) since being created. Billionaires can muscle their way into being middlemen for any kind of business. Capitalism today isn't really capitalism. If it were, Uber would have folded before most of us even heard of them. 💯

@joeshmoe7485 11 ай бұрын

wow, imagine passing on $6 billion only to go broke a couple years later. I never used a groupon but some of my friends did. I would never in a million years think a company selling coupons could be worth anywhere close to that. absurd valuation.

@davidjohnston1799 11 ай бұрын

They IPOd for $16b

@kiiltochii1607 11 ай бұрын

Company selling coupons is worth $0. But a company with an email list and data on millions of customers? Ka-Ching! 🤑

@deanmason5827 10 ай бұрын

Bull shit is like candy to a great many consumer's, especially the one's weak minded.

@egal1780 11 ай бұрын

0:41 if we all learned one thing: if you're on the front of Forbes or a similar news outlet, either sell your shares and flee the country to prepare because your frauf will be uncovered, or sell because this will be the peak of your company.

@ktktktktktktkt 11 ай бұрын

correlation vs causation. For companies like this, it's likely major shareholders would be involved in the decision to advertise/be involved with a magazine article. Also, your suggestion makes no sense. There was no fraud. Just not a very good business model.

@egal1780 11 ай бұрын

@@ktktktktktktkt there was a Video by Patrick Boyle about that topic. Like for example Elizabeth Holmes and Theranos, or Martin Shkreli...

@ktktktktktktkt 11 ай бұрын

@@egal1780 what in my comment does that relate to? There was no fraud.

@egal1780 11 ай бұрын

@@ktktktktktktkt It was adressed at "there was No fraud" which is true for this instance, but Not Generally

@mistermoneyman8899 11 ай бұрын

I have been in the MOVING business for 12 years and remember back i n the day when Groupon was REALLY pushing HARD to get moving companies to sign up. Albeit i was tempted to give it a shot, All I had to do was go to their site, do a simple look up of MOVING companies and what their rates were and they were ALL and ALWAYS 50% OFF.... we're talking about going from a $200 move to a $100 MOVING JOB and said to myself.... how do y'all make money off $100?!?!? NOW!!! seeing that Groupon was getting 50% of the cut which I didn't know til watching this video, Makes sense now. Profit margins in the MOVING business are very small Glad I decided to go a different route

@slodoco 11 ай бұрын

And after you move them, they aren't likely to be a repeat customer any time soon. In that business it makes no sense. But how do you compete with 100 dollar movers on Groupon? Yikes.

@ktktktktktktkt 11 ай бұрын

I mean, good for them turning down Google's 6B offer and later IPOing at a 13B valuation. I'm not sure how much the founders sold but seems they got a good deal.

@krmr 11 ай бұрын

Nah that was an idiotic smooth brain move on their end. Just Google how much the og founder CEO is worth today. Obviously he had to keep a lot of shares, every sale since IPO had to be disclosed. Could've been a billionaire. But instead got fired as CEO after the IPO had happened.

@elymanic3497 11 ай бұрын

That's if they cashed out.

@stavas05 11 ай бұрын

@@krmryeah the founders lost a lot, but it was the perfect move for the investors and most of all the samwer brothers

@HarishBabuM 11 ай бұрын

@@elymanic3497 how it was beneficial for the investors?

@krmr 11 ай бұрын

@@stavas05 CityDeal was before the IPO, could've still sold to Google and Samwers would've been paid accordingly to their shares. Dunno how much they sold or when they sold on the open market though, for sure it was a better deal for them.

@lostboy8084 11 ай бұрын

Honestly raise your hand if you saw a band-aid commercial recently. I think that they like do it once and a while to introduce a innovation or new type which is rarely.

@BatCaveOz 11 ай бұрын

One of the problems with Groupon was that vendors would often give customers a differentiated level of service vs. customers paying full price. eg. bad table and service at restaurant, bad room and service at hotel, bad haircut and service at salon etc. I know plenty of people that used Groupon to obtain a service and felt that they got a reduced level of service vs. customers paying full fare. This obviously is unlikely to result in repeat business. The vendor, knowing that the customer is less likely to actually come back vs a walk-in, is inclined to invest less time/money/effort. The customer, having received a poor experience, is unlikely to become a repeat customer. This creates a feedback loop resulting in less profit for vendors and a worse experience for customers. I am not all surprised to hear that they are about to go broke. ***They should have just sold to Google and become billionaires***

@AlanTheBeast100 11 ай бұрын

That defeats the purpose of the coupon which is a marketing cost to gain new clients. The real problem was the steep Groupon "slice".

@middleagebrotips3454 11 ай бұрын

At restaurants grouponers often tip based on the after discount amount, making for disgruntled servers. In later versions you would see clear terms saying grouponers getting auto gratuity based on pre discount amount. They went ipo and probably became bigger billionaire or multimillionaires.

@AlanTheBeast100 11 ай бұрын

@@middleagebrotips3454 IPO means their wealth = the stock value.

@michaelsilver253 11 ай бұрын

I was working for Zipcar back in the Groupon era. They did some kind of cross promotion that led to a shitload of local people to sign up for the service... but due to some kind of coding issue their coupon didn't work for the first couple days, and we had to field the customer service calls during business hours. As a low person on the totem pole I was helping out on the phones a lot. In those days I hungered for death

@yea-give-emhell7704 11 ай бұрын

Ohhh.... Do you have Zipcar stories? Would love to hear. I remember they were local and you can get someone from your area on the phone with great customer service. It's trash now😑

@HarishBabuM 11 ай бұрын

Why Google intended to buy this company for 6 Billion dollars

@lyth1um 11 ай бұрын

the restaurents in germany, served smaller portions for groupon customers, cant blame them.

@bubba99009 4 ай бұрын

Had no idea they took a 50% commission on every already massively discounted sale - that is crazy and unsustainable.

@MTNGear 11 ай бұрын

Had a bouncy castle business at the time this was popular in New Zealand. They pushed us hard for a ridiculous discount. Think we stuck to our guns and only did 25% but they took further fees. Took the view we'd do it once to get put in front of their mailing list. Was clear it wasn't worth it straight away and there were bloody coupons out there for ages.

@Lowness125 10 ай бұрын

I still have one of your groupons from 10 years ago. I am going to call you tomorrow to redeem it.

@MTNGear 10 ай бұрын

@@Lowness125 sold my share in it a decade ago so please let me know how that goes 😂

@grahamjones5400 11 ай бұрын

I rarely use coupons or special offers, its often just a mind game to get me to buy stuff i don't want or need, "Spend $500, get $100 in cash back. Offer ends next month!", or "Get $0.50 off the $20 Widget!". Ill just go to the dollar store and buy the generic widget brand.

@tsmall07 11 ай бұрын

I pretty much stopped buying Groupons when gmail started pushing their emails to the promotions section because I don't see the emails anymore.

@cgasucks 11 ай бұрын

Used Groupon quite a few times back in the day...now I hardly use it as there are less and less deals around.

@danielle2661 11 ай бұрын

Same here. You could really find some good deals back in the day. I actually looked recently and its crap now and companies are now offering their own coupons for an email address to be added to their email list or whatever. If a business is willing to use coupons why share profit with groupon when you can just offer coupons yourself now. It's no longer a great way to expose a business to people who may not find it otherwise. There are other marketing tools for that now.

@trainluvr 11 ай бұрын

I have had some very good groupon experiences, but also some not so good. A salon charged me a 'groupon tax' so I complained and groupon double refunded the illegal fee. More often what happens is you try out a business that is doomed from the start. They have a bad location, or they are a bar pretending to be a restaurant. Twice I went to restaurants that didnt even accept the groupon because I got the address or name confused with an adjacent business. If people are not returning to a business it is usually because they do not deserve to remain in business.

@kristoferreinholm3183 11 ай бұрын

If for any ungodly reason someone wants to know what store at the start 1:28 and 9:30 is it is a Estonian grocery store. The store in the video should be Baltijaama Selver?

@touchofgrey5372 11 ай бұрын

As always, greed gets the best of them!

@HeavyK. 11 ай бұрын

They pretended to be a technology company.

@joeshmoe9940 11 ай бұрын

Great content as usual. 👍

@OperationNonsense 11 ай бұрын

They turned down 6 billion offer, and cashed in on a 18 billion IPO, sounds like they made the good call and won the day. Post IPO decline only left investors holding the bag and therefore shouldn’t factor into the equation.

@siddharthbirdi 11 ай бұрын

They didnt raise 18billion though, they only raised 700 million through the IPO, with Google's offer they would have made much more and Groupon would have been Google's problem.

@WeAreCamels 11 ай бұрын

@@siddharthbirdi No, they got new investors to buy up 700 million dollars worth of the company and because the stock shot up to 18 billion each of the shares the founders sold they sold for 2x the price of what Google was willing to pay. Although the company crashed the founders probably cashed out billions before that. So they made a good call and made much more.

@siddharthbirdi 11 ай бұрын

@WeAreCamels I don't know the details of when they sold their shares but if it was a fresh offer then their shares only got diluted, and if they held the shares they would have eventually gone down 99%. Only if they sold at the top would you point be true, otherwise the Google offer would have got them the full amount at one go, albeit at a third of the valuation, but then they wouldn't have to explain to anyone how the money will be used as it would be Google's problem then.

@blablablabla542 11 ай бұрын

Tell me you dont understand an IPO without telling me you dont understand an IPO.

@dopemusic6414 11 ай бұрын

@@siddharthbirdiNope the founder Andrew Mason is estimated to be worth around $200m

@gabriel.casanas 11 ай бұрын

oh man that's gotta feel bad.

@wouldntyouliketoknow9891 11 ай бұрын

LMAO the CEO's statement about ACSOI is hilariously full of wishful thinking. The reality of course is completely the opposite. Johnson and Johnson has close to zero cost reacquisition - everyone freaking knows what bandaids are and there is no real competition. Groupon on the other hand is assuming that email marketing actually works. Reality is the emails are totally ignored and after a while the adaptive spam filters start putting it in "clutter" or spam folders. Groupon's reacquisition cost is obviously sky high compared to Johnson and Johnson.

@MCHuang 11 ай бұрын

User only decreased by 60% from it's peak? They're doing way better than I thought

@JohannaDotson2467 11 ай бұрын

I LOVE this breakdown. There was another financial influencer (bow tie nation) who broke this down last year and said their was unlimited potential and that they were about to explode. “Just know way they could go away”. This makes way more sense! Thank you!

@randomlifts 11 ай бұрын

You don't want discount customers as a way to run a business.

@user-dw1ls3rp1l 10 ай бұрын

Groupon pressured the crap out of us to do business. We were doing well enough with regular customers, and didn't want the type of ultra-frugal customer Groupon would bring in. Frugal customers are terrible. Something is always wrong, even when it isn't.

@OwenPhillipsMBA 9 ай бұрын

Interesting. With AI, chatbots etc a lot of the copywriting and company acquisition costs could be drastically reduced, so the concept might see a comeback!

@Olm- 11 ай бұрын

the concept for the sponsorship from this video was literally used as an example of how reading in a dystopia would look like in Fahrenheit 451 lol

@TheRusschannel 11 ай бұрын

As a business, used them once and it was HORRIBLE, never again... Lost a ton of $$$$

@screenwriterjohn 11 ай бұрын

I've never had a great meal from a Groupon. Even back in 2011, the half off meals were half off for a reason.

@8risk 3 ай бұрын

Yeah becuase Groupon kept half of the already discounted price so yeah

@kubluu 11 ай бұрын

Another banger

@bosorot 11 ай бұрын

Once upon a time . There is a Amazon $20 for $10 groupon deal . I make a total of 100 fake emails and do a self-referral.The end result is a $2000 Amazon GC for $1000 plus $1000 Groupon credit for referring friends. But I did not use most of Groupon's credit since most of the deals are not good even for free. This sum up the good , bad and ugly of Groupon.

@rebeccaliew2247 10 ай бұрын

Sad that Groupon came this state...through Groupon, I was introduced to many restaurants & activities I never thought possible to do or experienced. But I admit that I only went back to minority of shops at normal advertising rate due to mainly the distance needed to travel there + portion serving or pax needed to dine at a restaurant/experience a service.

@AlanTheBeast100 11 ай бұрын

Trying to convince people that a sunk cost is still in the bank. Astounding that the obvious "defection" reasons didn't change their offering to customers (retailers).

@Bxdarealest 11 ай бұрын

The company was basically very scammy and took advantage of business. A business will have a deal for a free beverage and gave them a list of no included beverages but Groupon would say: all your drinks free or something that sounded better. You pay and Groupon makes 50% of the price you paid so they didn’t care. Then tell business that they get 8 since the deal wasn’t selling at $30 so they lowered to 16$. Now you are showing the business your coupon but they say they never agreed to that. Most business I worked with they had cancelled Groupon but Groupon will not stop selling the coupons because they were very popular and made them money. Many business started putting a sign at the door saying : we do not accept Groupon, we do not have a deal with them. So basically Groupon was stealing and making people be mad at these business that weren’t getting any money to begin with.

@tatsuyaarai6029 6 ай бұрын

Customer information (for targeted ad) and money transaction. It seems like these are the two core cash cow for many tech companies. It is interesting that Groupon didn't seem like to tap into these instead of taking 50% from brick and mortar shops...

@wouldntyouliketoknow9891 11 ай бұрын

Everyone always thinks that on the way up the sky is the limit, and on the way down the turnaround is imminent. The reality is that the companies are typically reaching peak scale and valuation around the time people are thinking the sky is the limit, and when people think the turnaround is imminent, bankruptcy actually is imminent.

@manuelr1405 10 ай бұрын

Kramer put the whammy on it lol

@spicy_xinger 11 ай бұрын

has there ever been a tech broker platform that's been profitable? seems like they all make a lot of progress the first few years before people catch on and take what they do in-house. is the business of connecting a product/service-consumer just a business doomed to fail in the longrun

@alphakevin687 11 ай бұрын

I guess ticketmaster is doing well, since they are the only one in town

@Smoove_J 11 ай бұрын

I'm buying the dip. BOGO Chili's margaritas hasn't been priced in.

@sblijheid 6 ай бұрын

This is a child of when money is too cheap. The business model is a no go. The barriers to entry are too low and the relationship with business partners is parasitical. Either of the weaknesses can destroy the company. I never looked into them or used them and I'm a cheap skate. That tells a lot.

@dagda825 11 ай бұрын

0:56 the stock chart looks eerily like the dollar purchasing power chart.

@redMaple_QC 11 ай бұрын

The concept is good. The fee structure not so much.

@jamesstpatrick8493 11 ай бұрын

They can cut sales people and implement AI to create the writing portion and they call merchants to get new deals

@crimsonlightbinder 11 ай бұрын

too late and wouldn't have made much difference even then.

@indianapapi 11 ай бұрын

50% is way to high of a percentage, similar to Apple's 30% fee for in-app purchases. How do you not see this as a problem and adjust it as your numbers continuously decline?

@netropolis 10 ай бұрын

First time seeing one of you videos. Impressive, VERY well done! Liked, Subscrbed and hit the bell!

@blingiy 11 ай бұрын

You did a good job of explaining "Groupon", and why they are declining and will continue to do so.

@bruh_hahaha 9 ай бұрын

after a series of very unpleasant experiences, I haven’t even opened the app since 2012

@Jim-nt7xy 10 ай бұрын

Ya gotta know when to hold 'em.......

@foto21 10 ай бұрын

It should have made sense for merchants, but many reneged on Groupons, or expired them, which I know personally drove me away from Groupon ultimately. It wa a great novelty, but then had to evolve, and it wore out, and merchants prob got tired of giving deals to customers who would only come by when it was on sale. This is the problem with the model.

@MavonEast 10 күн бұрын

In food service I found that people who coupon do so faithfully. That likely means they won't come back without a deal. They follow the discounts from store to store.

@leflann2633 11 ай бұрын

I love Groupon lollll ima stick beside them

@bernieoconnor9350 11 ай бұрын

Tried it once, way back when, didn't work, didn't do it again.

@earthsosad 10 ай бұрын

havent heard this name for a loooong time

@Goawaypleasenow 10 ай бұрын

I’m a cosmetologist. A massage therapist who worked in our salon decided to try Groupon so she could quickly build a clientele for herself. She LOATHED that choice. It was SUCH a pain for her and she was so happy the day she fulfilled the last and final one.

@darrinatorrr 10 ай бұрын

They pissed people off by sending 10 emails a day

@cryptocsguy9282 11 ай бұрын

3:12-3:15 Unicorn in financial jargon means a start up company that has raised $1 billion in venture capital funding without an initial public offering of it's shares

@middleagebrotips3454 11 ай бұрын

The groupon model of advertising is not new. Ive done local ones where the ad company runs a local deal newspaper and i run 50% off coupon deals to pay for their editorial fees.

@user-me8hc3bs7i 11 ай бұрын

It’s entirely unsustainable and will eventually go bankrupt. But, one big difference in a pay per click ad vs Groupon is that you can directly see a return on the advertising when someone uses that coupon. It also got people to actually show up to your business and try the product. Pay per click ads have a horrific conversion rate for most businesses online because millennials and gen Z are conditioned to scroll straight past an ad without even registering it existed.

@dukeslaw 11 ай бұрын

Groupon is like Velcro total ‘Rip off’

@Rkcuddles 11 ай бұрын

Oh dang it, so I can’t capitalize marketing spend? Well there goes my business plan.

@geigertec5921 11 ай бұрын

Never heard of it.

@carsandthings5212 10 ай бұрын

Customer service is horrible. Bought vacuum once and it didnt come with a key part then Groupon declined to exchange or refund. After this i have never used Groupon in my life. Waste of time.

@basdfgwe 11 ай бұрын

I feel like you were talking to me when you talked about acsoi... I said outloud wtf is acsoi.

@innovatronixtv5025 11 ай бұрын

The problem with groupon, is they get 50% commission for all used coupons and if a customer fails to redeem the coupon, they pocket all of it. They are too greedy. Because of this, merchants never renew their deals with them. In the end they just faded away.

@ob1o675 Ай бұрын

The arrogance of not accepting a $6 Billion offer by Google will go down in history as one of the dumbest business decisions ever made. It will be an MBA case study of what not to do and not really understanding the MOAT of your startup. They were high on their own stuff - AVOID THIS BEHAVIOR.

@user-hd4jc1ct8q 22 күн бұрын

Are there any corporations on the up and up with good business plans???

@manout-kidin8735 11 ай бұрын

When some one or a company offers a too good of a cash deal for your business its better to take that deal also with arrangement of some small percentage of shares in return in sales agreement and exit it . You get the loads of hard cash & shareholding in the business you just sold with the added benefit of no need of managing it . 6 billion dollars buy offer from Google at that time was a great deal for a extremely heavy cash burning business .

@Uncle-Smart-Alec 11 ай бұрын

Jim Cramer endorsed it,no explanation needed.

@juanritanjaya6254 9 ай бұрын

I recall getting a eye roll from a restaurant when i showed up w a groupon. Now I know why, 50% cut is just ridiculous. Without good merchants your feedback loop is just going straight down.

@bicyclelife7088 11 ай бұрын

I am a advertising professional and we found our clients who used Groupon all complained that it just trained people to be cheap. They only came for the good deal, and never came back at regular price. So not only did you lose 50% of your money, you spent time and energy, and usually marketing dollars that could have gone towards finding a customer who actually had value. We would move all Groupon spend to Google & Facebook and do any sales internally, where we kept the data, and customer info and not Groupon, who would keep it to themselves. We didn't even get any learnings from the customers, only that they were cheap.