Groupon Eric: Target annual revenue reaches 100 billion dollars

News and technology information Beijing time May 16, according to foreign media reports, Groupon temporary joint CEO Eric Levkovsky (Eric Lefkofsky) and Teide Leoncis (Ted Leonsis) recently received a Science and technology blog BusinessInsider interview That Groupon hopes to become a localized Amazon or ebay in the future, eventually reaching a revenue of $100 billion a year.

Groupon is headquartered in Chicago, a four-year-old E-commerce company. Groupon pioneered the "buy" trading model, which grew faster than other companies in history, and rejected Google's 6 billion-dollar cash takeover offer, which was finally listed at $20 a share at the end of 2011.

But after the listing, the company's performance was surprised. The growth of the company's US business has suddenly stalled, and international business has plummeted, falling to $2 a share. Not long ago, Groupon sacked founder and CEO Andwen Messen Andrew Mason, appointing Lefkofsky and Leoncis as joint CEOs.

At present, Groupon's business seems to be stabilising and its share price has recovered to around $7 per share. Lefkofsky and Leoncis have been running the company for several months and will continue to run the company for at least a few months until hiring a new CEO.

Leoncis, Washington capitals of the US Hockey League team in Washington, is still brooding over the team's defeat in the first round of the NHL Stanley Cup playoff game. But he has left his game behind and focused on Groupon's operations.

Lefkofsky and Leoncis in the interview, focused on the following issues of interest to investors:

Future goals

Groupon hopes to become a large mobile local E-commerce company, the localized Amazon or ebay. Unlike today's email-only push for "buy deals," Groupon wants to be a site where users can access mobile devices wherever they are, and find deals and discounts on a variety of products and services on the site. Eventually, the company will work with businesses to offer group deals and discount deals for users, and the range of products and services will be far more numerous.

Groupon's revenue last year was 2.5 billion dollars. Leoncis that the company's revenues could end up to $100 billion a year.

By comparison, Amazon's revenue last year was $61 billion trillion, and Wal-Mart was 47 billion dollars.

Looking for a new CEO

For now, Groupon has not actually hired a headhunter to find a new CEO. This will be done after the next board meeting in June this year.

Lefkofsky and Leoncis say they haven't started looking for a new CEO because they intend to run the company for a while to determine what kind of CEO they want to hire.

The new CEO will not bring his "vision" to Groupon. Groupon's future goals have been set. The new CEO either tries to achieve that goal or will soon be out.

About Lefkofsky

Previously, the outside world did not know much about Lefkofsky. In the interview, Lefkofsky not only showed wisdom, but also seemed amiable and charming.

Lefkofsky, an early investor in Groupon, has been blamed for a $300 million trillion in financing a year before Groupon's IPO. In that round of financing, Groupon's founders and early investors had a total of 1 billion dollars. But since then, Lefkofsky has never sold Groupon shares.

International business is not hopeless

For now, Groupon's US business has grown relatively flat, but still doing well. At the same time, the company's international business has plummeted. But Lefkofsky and Leoncis don't think the company's international business is in a desperate position. They believe that the business will first achieve stability and then start to grow.

Adequate liquidity

Given the rumors that Groupon has been on the market for 18 months, some believe the company is not far from closed. But that is not the case.

Despite Groupon's troubles, the company's revenues continued to grow modestly (with year-on-year revenue growth of 8% per cent), with operating margins still positive ($ 21 million in the first quarter).

Indeed, Groupon's gross margin has slipped, so its gross profits are shrinking, and the growth of its third-party business, "Groupon hereby", has hit the company's impressive cash flow, with a negative cash flow in the first quarter. But Groupon still has plenty of liquidity. Groupon now has more than 1.1 billion dollars in cash and cash equivalents, and the business does appear to be stable.

Future challenges

If Groupon's revenues eventually grow to 10 billion dollars, not to mention the $100 billion Leoncis mentions, Groupon shareholders will make a lot of money (the company's current market capitalisation is about $5 billion trillion).

The ability of the new CEO and the further decline in international business are very important for Groupon. The company must also demonstrate that it can become a consumer-driven E-commerce platform, not just a company that "pushes" deals through email.

Lefkofsky's vision of localized e-business is a real opportunity, and Groupon has a huge advantage in making its vision a reality.