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LivingSocial Slashes Staff Amid Groupon Grumbles

3:18 PM, Nov 29, 2012   |    comments
Screen grabs of the LivingSocial app for the iPhone. (Photo: LivingSocial)
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By Scott Martin, USA TODAY

SAN FRANCISCO -- Layoffs at LivingSocial mark the latest evidence of struggles in the online coupon sector.

The Washington, D.C., startup, whose investors include Amazon, has today let go of 400 employees.

"I can confirm that roughly 400 employees were notified that their positions were being eliminated today, or about 10% of our global workforce," said LivingSocial spokesman Andrew Weinstein in an email.

LivingSocial layoffs come at a particularly troubling time for coupon king Groupon. Company co-founder Andrew Mason's stature as CEO is said to be in question by the board of directors, which is reported to be meeting today to consider his future there.

"If I ever thought I wasn't the right guy for the job, I'd be the first person to fire myself," Mason told an audience at a Business Insider conference on Wednesday.

Mason has his feet to the fire as shares of Groupon are down more than 80% from a 52-week high of $25.84.

There were signs of financial distress at LivingSocial. Amazon, which has a $175 million stake in the company, last month reported third-quarter earnings that contained a $169 million loss related to LivingSocial.

LivingSocial made most of the job cuts in the U.S., but "a couple dozen" of those positions were international ones, according to Weinstein.


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