Gini Dietrich

Groupon IPO In Jeopardy As They Violate SEC Rules

By: Gini Dietrich | August 31, 2011 | 
135

On the radio yesterday, they did an interview with Daniel Kibblesmith, a 27-year-old comedy writer for Groupon.

Rumor has it he’s one of Chicago’s most eligible bachelors.

And, apparently last night, he was the guy date on The Millionaire Matchmaker. I’ve never seen the show, but I’ve heard the guys who are typically on there are douchebags.

But that’s neither here nor there.

Because, at the same time the RedEye was calling Kibblesmith most eligible bachelor (five days ago), Andrew Mason was firing off a memo to his staff saying everything the media is saying about their impending IPO is fine. He countered every point, including janky accounting practices and whether or not they’re running low on cash, which is all fine and dandy.

But the email made its way into the media stream.

During the period that they are required to be quiet as they approach their IPO.

The email likely has violated the SEC rules that a company must not release anything during the period leading up to the initial public offering. This is to prevent pump and dumb scams or insider trading on the stock market.

But the reason I’m writing about it today is because, right before that email was sent, Bradford Williams, the vice president of global communications at Groupon, quit. And the story in BusinessInsider makes it sound as though Mason wouldn’t listen to counsel from Williams and just did what he wanted anyway.

So let’s review:

  • Six days ago, the RedEye calls a Groupon executive a most eligible bachelor.
  • Six day ago, Andrew Mason fires off an email to his team that is leaked to the media.
  • Yesterday morning, Kibblesmith appears on Chicago radio, doing interviews about his show’s appearance and his role at Groupon.
  • Last night, Chicago’s most eligible bachelor appeared on The Millionaire Matchmaker.
  • Last night, BusinessInsider breaks the news that Williams quit…most likely a week ago, before all of this happened.

We talk a lot here about what we would have done if we were counseling News Corp. or Kenneth Cole or Tiger Woods. But, finally, a PR professional got it right.

Bravo, Williams, for standing up for what you believe in, knowing the SEC rules around the dark period, and telling your boss where to stick it when he doesn’t listen to your counsel…because you were right.

Oh, and P.S., the SEC has a history of pulling a company’s IPO for pulling stunts like this. Groupon, you’ve been warned. You were stupid to walk away from the Google $6B offering. Don’t be stupid again.

About Gini Dietrich


Gini Dietrich is the founder and CEO of Arment Dietrich, an integrated marketing communications firm. She is the author of Spin Sucks, co-author of Marketing in the Round, and co-host of Inside PR. She also is the lead blogger at Spin Sucks and is the founder of Spin Sucks Pro.

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135 Comments on "Groupon IPO In Jeopardy As They Violate SEC Rules"

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jasonkonopinski
4 years 8 months ago

Kudos for using douchebags in a blog post! :)

ginidietrich
ginidietrich
4 years 8 months ago

@jasonkonopinski I also used janky. I’m quite pleased with myself.

jasonkonopinski
4 years 8 months ago

@ginidietrich Well, don’t get all hoity-toity, miss.

KenMueller
4 years 8 months ago
We talk a lot about how old-school businesses aren’t keeping up and learning from digital media. This is one way in which I think new media can learn from older, more established businesses. Sure, this kind of thing has happened for years, but it seems as if the younger entrepreneurs of the digital realm are a bit more cocky and immature, and yes, it is possibly a function of the fact that they are achieving success at a much younger age. A parallel would be the sports world, where teenagers and young 20somethings suddenly go from obscurity to multimillion dollar… Read more »
RobertCollins
RobertCollins
4 years 8 months ago

@CorpWriter4Hire Silly Groupon – Though ones core culture will always rise to help or hinder when it matters most. cc: @ginidietrich

bikespoke
bikespoke
4 years 8 months ago

When someone gives you 6 billion for a business model that has not shown any profit, especially in the economic conditions we are in globally, banks ans investors are forced to do their due diligence when investing. Should have asked for a cashiers check an walked out the door.

DebraCaplick
DebraCaplick
4 years 8 months ago

I know this is a rarity, but this one leaves me speechless.

M_Koehler
M_Koehler
4 years 8 months ago

Yeah, walking away from $6 Billion was sooooo smart. Yes, the guys on Millionaire Matchmaker are typically douchbags. The women are not much better either. And bravo for using janky and in the correct context!!

faybiz
4 years 8 months ago

G- you know it’s a genetic defect. Wondering if this is a bit of self-sabotage for some reason?

faybiz
4 years 8 months ago

G- you know it’s a genetic defect. Wondering if this is a bit of self-sabotage for some reason?

rustyspeidel
rustyspeidel
4 years 8 months ago

A. Men. $6B. Dumb. Asses.

rustyspeidel
rustyspeidel
4 years 8 months ago

A. Men. $6B. Dumb. Asses.

rustyspeidel
rustyspeidel
4 years 8 months ago

Hey G, relink to our blog post where we called this three months ago, so we can gloat. :)

MSchechter
MSchechter
4 years 8 months ago

Oh man, you are going to make this easy for me… Millionaire Matchmaker?!? I bring solid gold to the table and you bring Bravo shows? GOING DOWN!

MSchechter
MSchechter
4 years 8 months ago

P.S. as someone new to the world of PR is the strategy to try to distract the market from Mason’s blunder by trying to distract people with shiny bravo shows? Just dumb and not entirely following how the two threads weave :)

glenn_ferrell
glenn_ferrell
4 years 8 months ago

So Groupon, who refused to get out of the media water when the whistle blew, needs a new lifeguard. Gini ? (… insert Baywatch images here…)

ginidietrich
ginidietrich
4 years 8 months ago

@KenMueller The thing that gets me is they’re clearly getting the right advice, but choosing to ignore it. So it has to be arrogance. I don’t know what else it is.

ginidietrich
ginidietrich
4 years 8 months ago

@KenMueller The thing that gets me is they’re clearly getting the right advice, but choosing to ignore it. So it has to be arrogance. I don’t know what else it is.

ginidietrich
ginidietrich
4 years 8 months ago

@jasonkonopinski Yeah. I just broke my arm patting myself on the back.

ginidietrich
ginidietrich
4 years 8 months ago

@jasonkonopinski Yeah. I just broke my arm patting myself on the back.

ginidietrich
ginidietrich
4 years 8 months ago

@bikespoke A-freaking-men.

ginidietrich
ginidietrich
4 years 8 months ago

@bikespoke A-freaking-men.

KenMueller
4 years 8 months ago

@ginidietrich we were young and stupid once, right? ok, maybe not. I was never stupid. But I think I remember being young…

ginidietrich
ginidietrich
4 years 8 months ago

@DebraCaplick LOL! I let it stew all night before I wrote this. Arrogant.

NancyD68
4 years 8 months ago

Maybe its me, but I think as people get more money, they get dumber (or maybe just more arrogant) I can’t imagine what would make you want to go running off at the mouth at a time like that. Even I know what a dark period is.

Anyone who goes on any of those shows is automatically less intelligent to me. Does he have a spray tan too?

ginidietrich
ginidietrich
4 years 8 months ago

@M_Koehler Yay! I used your word!

ginidietrich
ginidietrich
4 years 8 months ago

@faybiz I don’t know. Maybe. I think it’s more a function of arrogance and feeling like they’re above the law.

ginidietrich
ginidietrich
4 years 8 months ago

@faybiz I don’t know. Maybe. I think it’s more a function of arrogance and feeling like they’re above the law.

ginidietrich
ginidietrich
4 years 8 months ago

@rustyspeidel You don’t think our gloating in private is enough. Dumb, dumb, dumb. And we did call this.

ginidietrich
ginidietrich
4 years 8 months ago

@MSchechter Either way, they’re not allowed to have anything in the media. No leaked memos. No TV appearances. Nothing.

ginidietrich
ginidietrich
4 years 8 months ago

@glenn_ferrell Can you imagine? I’m gaining a pretty clear arrogance picture. No freaking way I’d go in the water for them.

ginidietrich
ginidietrich
4 years 8 months ago

@NancyD68 I don’t know about the spray tan. LOL! And it’s arrogance. Not stupidity.

FocusedWords
FocusedWords
4 years 8 months ago

@ginidietrich Or with them, right?

Al Smith
4 years 8 months ago

@ginidietrich Yes Gini. Arrogance and Ego ! The CEO’s with the Huge EGO’s, talkin about IPO’s. Whats next UFO’s ? Walkin away from $6 Billion ? Wow !

FocusedWords
FocusedWords
4 years 8 months ago

This on top of the Forbes article about Yelp and Facebook shutting down their daily deals doesn’t bode well for the price of the IPO IMHO. But then I haven’t figured out how to get investors to give me cash that I put in the pockets of earlier investors and still turn down $6B. Think Google is saying “Thank You, God” this morning?

M_Koehler
M_Koehler
4 years 8 months ago

@ginidietrich Tis a great word.

M_Koehler
M_Koehler
4 years 8 months ago

@ginidietrich @rustyspeidel There is absolutly nothing wrong with gloating about this one. Truly a stupid move on their part.

bikespoke
bikespoke
4 years 8 months ago

To quote David Bowie song< " We could steal time, just for one day" running through their heads right now.

TheJackB
4 years 8 months ago

Talk about quiet periods to a lot of people and they don’t understand what you are referring to. As others here have mentioned I suspect that too much “success” has had a negative influence upon judgment.

MSchechter
MSchechter
4 years 8 months ago

@ginidietrich Gotcha, like I said, I’m dumb. Didn’t realize you were saying that the TV appearance was as risky.

wabbitoid
4 years 8 months ago

The only thing worse than being broke all the time is knowing that arrogant idiots have billions of dollars thrown at them for pure BS. Call it schadenfreude all you want, but there’s no shame in watching people like this fall hard, IMHO. The sooner, the better, too. Some of us could use that money to do useful things.

janbeery
4 years 8 months ago

I think people tend to start seeing themselves as bullet proof when it comes to rules, guidelines and consequences. WOW Groupon, WOW!

EGarimbao
EGarimbao
4 years 8 months ago

How it is happened?

maniactive
maniactive
4 years 8 months ago

@mdyoder Wow. Is it possible that Groupon is too stupid to live?

glenn_ferrell
glenn_ferrell
4 years 8 months ago

@ginidietrich Yeah – if they don’t listen to the lifeguards, who knows what else they are doing in the water. Safer to swim with those sharks – even if they do have a bad rep.

glenn_ferrell
glenn_ferrell
4 years 8 months ago

@KenMueller Yeah – this was actually my first thought. The problem may be that too many “new school” businesses are spending so much time in the social media waters that they have come to think of themselves as fish — instead of businesses. There is this subtext to the social media layer of “you can never communicate too much”. Well, here’s a great (and likely financially-painful) example of communicating too much.

mdyoder
mdyoder
4 years 8 months ago

@maniactive “You gotta know when hold ’em, know when to fold ’em…” 😉

mdyoder
mdyoder
4 years 8 months ago

@maniactive Watch out, you’ll probably get Klout for groupon and roast. Or, maybe it will be toast!

maniactive
maniactive
4 years 8 months ago

@mdyoder Grosst.

Jack Rayher
Jack Rayher
4 years 8 months ago

Too bad. I was hoping to short Groupon when they went public. All the retailers I talked to wouldn’t use them again.

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