Groupon president and COO leaving

By Dow Jones Newswires-Wall Street Journal
Posted March 22 at 7:43 p.m.

Groupon Inc.’s president and chief operating officer, Rob Solomon, is stepping down as the Internet company remakes itself from a small start-up to a major online player.

The move comes as Groupon, which offers group discount deals, has experienced explosive growth. Solomon, a Silicon Valley veteran who joined the company a year ago, said in an interview he is stepping down partly because “Groupon got really big.” When he joined the company a year ago, the company had 200 employees, but today it has some 6,000, he said.

Solomon decided to step down following consultation with Groupon’s chief executive and founder, Andrew Mason. “I agree with Andrew that we really need a much different type of operator to take it to the next level,” he said. “What we did in that one year is equivalent to what happens in five years at the best Internet companies.” Solomon said that Groupon had yet to find a replacement for him, but that the company was “talking to lots of world-class COO types.”

Solomon said he is “absolutely not” leaving because of any problems at the company.

Solomon said he planned to return to California but would remain as a “special advisor” to Chicago-based Groupon, which sells local commerce deals online in 44 countries. He said he may set up a California branch of Lightbank, a venture-capital firm set up by early Groupon investors Eric Lefkofsky and Brad Keywell.

In an email, Groupon’s Mason said that Solomon “added enormous value to Groupon, and we’ll miss having him around.”

Tech blog All Things D, which like The Wall Street Journal is owned by News Corp., earlier said Solomon is stepping down from Groupon.

Groupon is the largest player in an emerging segment of e-commerce that brings local businesses online through deeply discounted deals that shoppers learn about through emails and smartphone apps. Groupon faces hundreds of competitors, including Livingsocial, which has received funding from e-commerce giant Inc.

Groupon has countered the competition through aggressive marketing and by expanding quickly to markets around the world. In January, the company completed a $950 million round of financing amid a flurry of interest from would-be investors.

Groupon continues to meet with bankers to discuss potential plans for an initial public offering, but it has not chosen banks yet, people familiar with the matter said. A public offering could value the company at between $16 billion and $20 billion, based on Groupon’s revenue growth projections and robust investor appetite for new stocks, they added.

Last December, Groupon turned down a $6 billion takeover offer from Google Inc.

Lightbank’s Lefkofsky, who is also chairman of Groupon’s board of directors, declined to comment on any plans for a Groupon IPO. He said that for his venture capital firm, “we would love to be affiliated with 1 8 Solomon 3 8 if we can.”

Solomon is still evaluating what role he’d like to take with Lightbank, said Lefkofsky.

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