Last fall, things didn’t look good for Groupon — the deal site that three of your friends wouldn’t shut up about in 2011. Its stock price had sunk to a new low as it fired more than 1,000 employees and closed operations in six countries and Puerto Rico. But the company got some good news today in the form of a $250 million investment/partnership with Comcast.
Technically, the money is coming from Atairos, which is not the name of a mid-level video game boss but is the strategic investments company that Comcast created in March 2015. But since $4 billion of Atairos’ $4.1 billion startup money came from Comcast, and Atairos is contractually blocked from taking any outside money from anyone other than Comcast for another nine years — Groupon is effectively getting the money from the folks at Kabletown HQ.
Additionally, the deal directly involves Comcast Corporation, which will partner with Groupon in some vague capacity to “identify and implement potential strategic partnership opportunities.”
(On a personal note: I’d love it if someone handed me $250 million without naming any specific goals.)
Even the statement from Comcast Cable CEO Neil “No, There’s No ‘H'” Smit hints at only the possibility of Groupon actually having to do anything to earn this money.
“Groupon is an established leader in connecting customers with local businesses,” semi-explains Smit. “The potential in combining Groupon’s local expertise with Comcast’s vast subscriber and advertiser network is something we look forward to closely exploring together.”
“Potential”… “closely exploring”? Perhaps this is one of those new advertising innovations that Comcast’s not-a-lobbyist-in-chief David Cohen recently claimed would be shut down by FCC privacy rules that have yet to be written. We may never know.
In fact, the announcement from Groupon makes it clear that the money isn’t to be used for anything other than “general corporate purposes, including the repurchase of stock.”
The statement from Groupon CEO Rich Williams — who not even a year ago was talking about “doing more with less — basically sounds like someone trying to make word count on a college marketing class by throwing around buzz phrases.
“Our partnership with Atairos will help accelerate our transformation while better positioning us to execute on our strategy and mission to build the daily habit in local commerce,” says Williams. “I am extremely pleased that a respected, long-term oriented partner like Atairos shares our view about the vast opportunity ahead for Groupon.”
While today’s announcement did help Groupon stock price gain a bit, the company is still trading about 40% lower than it was a year ago, and at about one-fifth of its all-time high price shortly after going public in 2011.