Groupon Inc (NASDAQ:GRPN) Still Battling For Survival Amid Positive Market Sentiment


Ten years since inception, and a few less since going public, Groupon Inc (NASDAQ:GRPN) is still struggling to find a strong foothold. The company had one of the most tumultuous years in the history of online marketing. According to Smart Company, Groupon’s spectacular rise ended in disaster. However, the current positive market sentiment might just save the company.

Smart Company cites an interview that the former Groupon CEO had with Gimlet Media. In the interview, Andrew Mason recalls how Groupon’s board fired him from the company he founded. According to Smart Company, “Groupon was the fastest-growing company of all time, it was a humble startup that shot to billion-dollar revenues and global reach within just a few years — and which listed, sank and sacked its chief executive officer almost as swiftly.”

Rise and fall

Particularly, the company began encountering challenges when it announced the decision to go public. Shortly afterwards, IBM took the company to court demand reparations for Groupon infringing on their intellectual property.

After a drawn out lawsuit, The Economic Times reports that the court ordered Groupn to pay IBM $57 million to settle the dispute. However, this is against the $167 million that International Business Machines demanded.

According to the lawsuit, Groupon used IBM’s patented technology that facilitated ecommerce without permission. Initially, the jury had settled at $83 million but is seems the amount just reduced. According to The Economic Times, “the settlement agreement also included a longterm patent cross-licence agreement between the companies.”

Positive market sentiment boosting share estimates

Interestingly, the company is slowly coming back to profitability. A Forbes report indicates that Groupon initiated several restructurings that are relaunching the company. Particularly, the company puuled out of all countries in which it was making losses. As at now, the company serves only 15 out of the original 50.

However, the gamble seems to be paying off as there is increasing positive market sentiment. MarketBeat reports that Groupon shares earned an average rating of “Hold” from 16 rating firms. However, other ratings firms advice investors to “strongly” buy. Basically, this speaks to the future potential of Groupon.

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