Early Investors Of Groupon Shedding Stock
By Chuck Sudo in News on Aug 20, 2012 5:20PM
We know that Wall Street is no longer bullish on Groupon. Now it looks as though some of the company's early investors are getting out while the declining stock has value.
The Wall Street Journal is reporting that at least four investors who bought into the online daily deal pioneer before the company’s November 2011 IPO have either cashed all or a significant portion of their investments. The most notable name among these investors is Marc Andreessen, the Silicon Valley vet best known for selling Netscape Communications during the dot-com bubble of the late 1990s.
Andreessen sold all 5.1 million shares of Groupon stock he owned once restrictions on holding the shares ended at the end of June. His firm Andreessen Horowitz earned $14 million on Groupon stock prior to the IPO. The dumping of Groupon stock not only means more possible trouble for the company. It also is a sign that investors are no longer excited about what they hoped would be a boom in social media stocks and is drawing parallels to that 1990s dot-com bubble.
Another reason Groupon stock is at an all-time low is a lack of faith in CEO Andrew Mason’s leadership of the company. Mason was interviewed by AllthingsD.com’s Kara Swisher via Skype where he defended his leadership of the company, laid out future plans for Groupon, and listed his regrets with the handling of the IPO (or lack thereof).
Groupon stock, by the way, is trading 0.21 percent lower today.