Now that the daily coupon Groupon has filed its IPO paperwork, the backlash is getting louder and louder. The company's largest shareholder and chairman, Eric Lefkofsky, has a "checkered past"; the site is having problems in China; and some are saying that the business model is fundamentally flawed. It's time for another round of Groupon backlash!
First up, Eric Lefkofsky: the entrepreneur has a past littered with lawsuits and shady investments, and "it's still not clear how much control" he has at Groupon. Also, he and his family have already cashed out $382 million before the IPO was filed. According to Fortune, his involvement means Groupon's "IPO is waving more red flags than a May Day parade."
Groupon's having issues in China, too, and while they may not have fired the "trendy-looking but ineffectual foreigners who can't speak Chinese" who were managing Groupon China as originally reported, there are questions about their Chinese partner, Tencent and their goal to make Groupon China "a city guide, a lifestyle."
And then there are those who just have a problem with the whole model, with Rocky Agrawal at TechCrunch calling it "actually just a clever repackaging of old ideas" and comparing it to "the moral equivalent of predatory lenders selling subprime liars loans to people they knew couldn't afford it."
In a very long profile, Groupon CEO Andrew Mason tells the Guardian that he's probably not the first person to have these ideas, though, just the first person to successfully implement them on the internet:
"In music, which was my world before, you've got thousands and thousands of years of great ideas that have already been thought of. But the internet is basically 20 years old. So you can be way stupider and still have world-changing ideas. So yes, it is simple."
· The Checkered Past of Groupon's Chairman [Fortune]
· Groupon: Still Getting Pwned In China [TechCrunch]
· Why I Want Google Offers And The Entire Daily Deals Business To Die [TechCrunch]
· Groupon: The Golden Nugget [Guardian]
· All Groupon Coverage on Eater [-E-]