Yesterday, in response to question about how the numbers would affect Mr. Mason, Groupon spokesperson Paul Taaffee told Bloomberg, “He’s here today.” He was speaking literally.
Groupon just announced that Mr. Mason is being replaced. The company has named a “newly created Office of the Chief Executive,” led by executive chairman Eric Lefkofsky and vice chairman Ted Leonsis, who will “serve in this role on an interim basis.”
Mr. Lefkofsky, whose venture firm Lightbank recently set up shop in New York, got some attention pre-IPO when he and cofounder Brad Keywell used a Groupon funding round to cash out shares worth $451 million–a tactic he’s used in the past.
As Business Insider points out, Mr. Lefkofsky also “has interests in several companies that have close relationships or contracts with Groupon that, for a long time, have represented a conflict of interest for the company, as disclosed in its SEC filings.”
Take this disclosure from a recent 10-Q filing:
“[Lefkofsky's] investments may be in areas that present conflicts with, or involve businesses related to, our operations. There can be no assurance that our business will not be adversely affected as Mr. Lefkofsky devotes less time to our business in the future.”
Groupon’s board, which is currently searching for a new CEO, has its work cut out for them.
This week, the company revealed that Q1 revenue would be $560 million to $610 million, when analysts (on average) predicted $647.7 million. Groupon also said it lost $81.1 million (12 cents a share) in Q4, when analysts predicted a loss of 2 cents per share. That led to the largest intraday decline since November, with stock diving 19 percent yesterday afternoon.
However, shares are up in after-hours trading once Mr. Mason’s ouster was announced.
In the press release, Mr. Lefkofsky thanked Mr. Mason, on behalf of the board, “for his leadership, his creativity and his deep loyalty to Groupon.”
But through an unverified Twitter account, @AndrewMason tweeted a link to an unconfirmed good-bye letter that says he was fired.
The letter has since been deleted, but we have a screencap from earlier this afternoon. And it has mensch written all over it.
Mr. Mason took accountability for his role in the company’s financial weakness–a first from Startupland? He also praised his employees, admitted failure, referenced the NES videogame Battleroads, and asked for recommendations for how to lose the Groupon 40. (Nota bene: this is coming from a leader who presided over some sophomoric stunts and “financial voodoo,” that adversely affected his company.)
OK, I’m good on the fat camp recommendations.You may stop.Thank you.
— Andrew Mason (@andrewmason) February 28, 2013
Enjoy your new waistline, Mr. Mason. Sounds like you earned it.