The ongoing Groupon IPO saga is starting to create its own spin-offs – of the dramatic variety.
Over the past week, CEO Andrew Mason’s attack on critics of the planned IPO via an employee memo was leaked to veteran tech blogger Kara Swisher, sparking a public spat between her and rival tech blogger (and Groupon critic) Henry Blodgett.
Some observers note the leaked memo may violate SEC quiet period rules, creating further problems for the company’s plan to raise up to $750 mn.
The coda to this mini-drama came Wednesday with the revelation that tech PR veteran Bradford Williams (Yahoo!, VeriSign, eBay and Gateway) resigned earlier in the week after just two months on the job at Groupon, with Blodgett speculating that the departure was due to disagreement with Williams’ boss about the internal memo leak.
The origin of all this came in May when the Chicago-based social media coupon shopping outlet filed an S1 touting its phenomenal prospects. A key metric Groupon pointed to was a controversial non-GAAP measure – ACSOI (adjusted consolidated segment operating income) – that backed out most marketing expenses as one-time subscriber acquisition costs.
That bit of creativity fueled Groupon’s critics and attracted SEC scrutiny. Two weeks ago, Groupon pulled the metric from its revised S1, but by then the market for IPOs had softened and critics (Blodgett among them) kept hammering at the Groupon story.
Late last week Mason issued an internal memo to reassure Groupon’s 9,625 employees by taking on company critics, once more explaining ACSOI, updating financial projections for August and explaining that the company’s growing payables were a good thing. ‘Finance geeks call this a working capital deficit,’ the memo noted.
All Things Digital co-editor Swisher posted the memo with her commentary, sparking Blodgett to speculate that Mason had orchestrated the leak to his rival.
The spat spilled, appropriately, into a tweet-off between Blodgett and Swisher. Yesterday Blodgett reported Williams’ departure – crediting Swisher for tipping him off.
Who said nothing happens in August? If nothing else, it keeps Groupon’s pending IPO in the news.
Here’s a link to Swisher’s original post with the internal memo, a link to Blodgett’s initial post on the employee memo and to a Reuters report on the skirmish between the two. Finally, here is a report from Blodgett’s blog site about Williams’ departure.
