Comment by tyre

I worked at LivingSocial back in 2012. I was 21 and didn’t know anything about marketing. The pitch was that daily deals helped small businesses get new customers who would then become recurring, which was good. I liked helping small businesses.

Over time I realized that the company knew this wasn’t really true. Daily deal customers weren’t likely to return. They went where the deals were. The influx of cash from daily deals was a marketing expense, almost always at a loss (most deals were 50%+ off and half of the remaining revenue went to LivingSocial), and buyers rarely returned so SMBs would never recoup their loses.

Once I figured this out, I decided to leave even though I would miss my equity cliff by a month. I ended up joining ZenPayroll (now Gusto) early on because they were helping SMBs with a real problem (payroll was a fking nightmare back then.)