Two months after firing its CEO, Groupon is facing another setback: The executive in charge of Groupon Goods, the part of the company that has provided a bright spot in an otherwise struggling daily deals business, has resigned, sources close to the situation have told us.
Faisal Masud, the vice president of Groupon Goods, will be leaving the company later this month, the sources said. One of the sources said he has taken a top position at Staples.
Groupon Goods, which was started in 2011, is one of Groupon’s newer businesses and is its first push into more traditional e-commerce. It sells discounted goods from companies like Dell, and is separate from Groupon’s traditional local coupon business. Masud was hired away from eBay in 2012 to help build Goods, which Groupon announced in April had reached an annual run rate of $2 billion in global billings. Groupon as a whole had $5.38 billion in gross billings for 2012, the company reported in February.
“As we’ve discussed before, growth of Goods … has impacted our overall margins as it has grown materially over the last few quarters, reaching an impressive $2 billion annual billings run rate in Q4,” then-CEO Mason said in the company’s fourth quarter earnings call in February.
The company’s stock has been pounded since it went public in late 2011 — at one point it was trading in the 20s, but more recently has fallen into the mid single digits. Part of the issue for investors has been questions about the reliability of the company’s accounting — last March, for example, Groupon had to restate its earnings after a higher-than-expected number of customers demanded refunds.
But also driving the downward pressure on the stock price is investor skepticism about whether the company can become more than a simply a daily deals site. Many analysts think that model has limited potential, because users can easily tire of the daily email blasts, and for merchants, the deals don’t necessarily translate into a greater number of loyal customers.
Masud’s job has been to help the company become a much broader e-commerce company, a “searchable marketplace,” as Groupon executives referred to it on a recent earnings call. Our sources said Masud’s departure was prompted by tensions between the emerging e-commerce side of the company and Groupon’s local-coupon roots. Before joining Groupon, Masud was head of global shipping and fulfillment for eBay, and before that spent five years at Amazon.
Groupon told us it had no comment. We also reached out to Staples, and will update the story if we hear back from them.
Groupon has been in the spotlight most recently with the high-profile departure of CEO Andrew Mason. Cofounder Eric Lefkofsky and fellow board member Ted Leosis have been named interim co-CEOs while the company searches for his replacement. The company will report its first quarter earnings on Wednesday. The stock closed at $5.84 on Friday.
Update: On Tuesday Staples announced that Masud had joined the company as executive vice president for global e-ecommerce. The full press release from Staples can be found here.