Tuesday 28 June 2011

Song: Que Sera Sera -- Doris Day & Carry On Till Tomorrow -- Badfinger



Two old songs I want to introduce to you today, a busy day.

The first one came to my mind after I was asked what will the future be. Presenting classic Doris Day's Que Sera Sera (Whatever Will Be, Will Be) (1956)



Lyrics:

When I was just a little girl
I asked my mother, what will I be
Will I be pretty, will I be rich
Here's what she said to me.


Que Sera, Sera,
Whatever will be, will be
The future's not ours, to see
Que Sera, Sera
What will be, will be.


When I was young, I fell in love
I asked my sweetheart what lies ahead
Will we have rainbows, day after day
Here's what my sweetheart said.


Que Sera, Sera,
Whatever will be, will be
The future's not ours, to see
Que Sera, Sera
What will be, will be.


Now I have children of my own
They ask their mother, what will I be
Will I be handsome, will I be rich
I tell them tenderly.


Que Sera, Sera,
Whatever will be, will be
The future's not ours, to see
Que Sera, Sera
What will be, will be.

As most people will guess, "Que Sera Sera" naturally means "What ever will be, will be", but the fact is not as simple.

According to Wikipedia, it happened that one day the composer of this song watched a 1954 film and saw an Italian motto of  the family in the film "Che sarà sarà" and took it to be the song title. Then the lyricist of the song changed it to Spanish "Que Sera Sera" (without the accent mark) because the language is more popular. However, what might be intriguingly coincidental is that

""Que sera sera" (with this evidently Spanish-based spelling, but no accent marks) appears as the motto on an English family coat of arms described in William Bartlett's 1865 history of the parish of Wimbledon."[1]

**************************************************

The second one was introduced by my uncle after he knew that I was feeling down.He told me not to be trapped in the past and move forward, Carry On Till Tomorrow by Badfinger (1969-1970), a group which got their name after being picked up by The Beatles' Apple label in 1968.[2]

Therefore, you might feel that their songs resemble the style of The Beatles.


Lyrics:



In younger days, I told myself my life would be my own
And I'd leave the place where sunshine never shone
For my life's too short for waiting when I see the rising sun
Then I know again that I must carry on


Carry on till tomorow, there's no reason to look back
Carry on, carry on, carry on


Beyond the shadows of the clouds and onward to the sky
Carry on till I find the rainbow's end
For my life's too short for waiting when I see the rising sun
Then I know again that I must carry on


Carry on till tomorow, there's no reason to look back
Carry on, carry on, carry on


Drifting on the wings of freedom, leave this stormy day
And we'll ride to tomorrow's golden fields
For my life's too short for waiting when I see the rising sun
Then I know again that I must carry on


Carry on, carry on, carry on


And when the heavy journey's done, I'll rest my weary head
For the world and it's colours will be mine
For my life's too short for waiting when I see the setting sun
Then I know again that I must carry on


Carry on till tomorow, there's no reason to look back
Carry on, carry on, carry on


Hope you can find strengths from these songs too!

Vocabulary:
intriguingly -- (adv) very interesting because of being unusual or mysterious
coincidental -- (adj) an occasion when two or more similar things happen at the same time, especially in a way that is unlikely and surprising
resemble -- (vb) [T] to look like or be like someone or something



Resources:
Doris Day -- Que Sera Sera @ YouTube
http://www.youtube.com/watch?v=xZbKHDPPrrc

[1] Que Sera, Sera (Whatever Will Be, Will Be) @ Wikipedia
http://en.wikipedia.org/wiki/Que_Sera,_Sera_(Whatever_Will_Be,_Will_Be)#Language_in_title_and_lyrics

Doris Day -- Que Sera Sera lyrics @ LyricZZ.com
http://www.lyriczz.com/lyrics/doris-day/12960-que-sera-sera/

Carry On Till Tomorrow - Badfinger - Magic Christian Music @ YouTube
http://www.youtube.com/watch?v=sC24GI9V_Cs

Carry On Till Tomorrow - Badfinger @ Oldielyrics
http://www.oldielyrics.com/lyrics/badfinger/carry_on_till_tomorrow.html

[2] Badfinger @ Wikipedia
http://en.wikipedia.org/wiki/Badfinger

http://dictionary.cambridge.org/dictionary/british/intriguing?q=intriguingly
http://dictionary.cambridge.org/dictionary/british/coincidental?q=coincidental+
http://dictionary.cambridge.org/dictionary/british/coincidence?q=coincidence
http://dictionary.cambridge.org/dictionary/british/resemble?q=resemble+

Technology: ReadyBoost for Windows 7 and XP



ReadyBoost for Windows 7 has been talked about for many years. At the users' level, what you need to know is that if you have unwanted USB flash drives or any other unused memory sticks, you can simply plug it in while you are running Windows 7, when a box appear you click the ReadyBoost tab and then assign the amount of space you want the computer to use as RAM. This can keep your computer fast when more RAM is needed, which is pretty cool! (More information here)

Image from compufix castle dermot
Windows 7 allow up to 256 Gb, so if you have unwanted USB drives, don't throw them away!!!

But how about Windows XP? Can we do the same on XP? This is not a new thing, since Windows XP is phasing out. but not too many people will care to find out how. I was curious, and this is what I learnt.


If you want a readable version of the instructions, click here, or read it below:


First insert a flash drive
Open up the Control Panel.
Go to "System."
Choose the advanced Tab.
In the Performances section, click on "Settings."
Choose the advanced tab there.
In the "Virtual Memory" Section, press "Change."
Select the letter corresponding to your flash drive. (Hint: It's not C.) You can let the system manage the size or customize the amount of space that you want used as virtual memory. I'm not going to use this flash drive for anything else, so I'll let the system manage it.
Make sure to Press Set once you've made your choice.
Press OK, and the changes will take effect.
Then restart your computer.
And now you have a little extra memory at no additional cost.

If you have multiple hard drives, you can similarly choose the hard drive in the last step instead of the USB Flash drive, and then restart the computer! That can also speed up your system!


Resources:
ReadyBoost @ Wikipedia
http://en.wikipedia.org/wiki/ReadyBoost

Use a flash drive as memory in Windows XP @CNet
http://cnettv.cnet.com/8301-13415_53-10121584-11.html

ReadyBoost @ Microsoft
http://windows.microsoft.com/en-US/windows7/products/features/readyboost

Sunday 26 June 2011

Song: Moon River -- Audrey Hepburn, Louis Armstrong, Andy Williams & Khalil Fong



Suggested by Cecilia, the legendary Audrey Hepburn very first original version of Moon River, song in the Breakfast at Tiffany's (1961) movie. Downtempo, dreamy, wishful and calm!
Image from Wikipedia


One of my favourite classic songs, but for me, I think I prefer a deeper, coarser, more sophisticated and seasoned voice, like this jazzy version by American Jazz Trumpeter Louis Armstrong.


There is also another one which is quite good, by Andy Williams in 1961.


This is a simple song with no-so-simple meaning. I guess different people will have different versions of understanding for this song. In my opinions, it talks about the singer, who is travelling on a clear river in the night and the moon was up in the sky. Because the river was clean, the moon is fully reflected onto the river.

Image from bleedingroots.files.wordpress.com

One day, the singer travels on this river, a river which has witnessed many other travellers' dreams and heart-breaks. The singer has no particular direction she prefers, she only wants to go where the river wants to go.

But this singer is actually not alone. She is with someone else, drifting on this river to go and see this fantastic world.

Rainbow is formed in the sky, but it often starts and ends on a water surface, in this song, it ends on the moon river as well, and the end of the rainbow is where the singer and the other person want to go.
Image from artfromthesoul

Waiting at the bend of the river, is the singer's "huckleberry friend", the moon river itself, and the singer herself.

Huckleberry is of course a kind of berry that taste like blueberry, but "my huckleberry friend" is not a friend who tastes or smells like berries, it is actually a slang with a simple meaning, "my best friend".

Hope you can understand this song better by now!

Have a nice weekend!!

Lyrics:

Moon river, wider than a mile
I’m crossing you in style some day
Oh, dream maker, you heart breaker
Wherever you’re goin’, i’m goin’ your way

Two drifters, off to see the world
There’s such a lot of world to see
We’re after the same rainbow’s end, waitin’ ’round the bend
My huckleberry friend, moon river, and me

(moon river, wider than a mile)
(i’m crossin’ you in style some day)
Oh, dream maker, you heart breaker
Wherever you’re goin’, i’m goin’ your way

Two drifters, off to see the world
There’s such a lot of world to see
We’re after that same rainbow’s end, waitin’ ’round the bend
My huckleberry friend, moon river, and me


Vocabulary:
huckleberry friend -- (n) [C] best friend

Resources:
Moon River @ Wikipedia
http://en.wikipedia.org/wiki/Moon_River

Moon River - Breakfast at Tiffany's @ YouTube
http://www.youtube.com/watch?v=BOByH_iOn88

LOUIS ARMSTRONG ~ Moon River ~ @ YouTube
http://www.youtube.com/watch?v=Fd_JDrnBMMA

http://www.youtube.com/watch?v=flm4xcOyiCo
http://www.youtube.com/watch?v=LK4pmJQ6zgM

方大同 - Moon river (CD Version) @ YouTube
http://www.youtube.com/watch?v=NL-0RurzyII
Huckleberry @ Wikipedia
http://en.wikipedia.org/wiki/Huckleberry#Use_in_slang

Friday 24 June 2011

People: "Mr Chow, Leslie Chow!" -- Ken Jeong


Image from Teaser-Trailer.com

Friday for a break, if you haven't caught this movie, you should do it this week!
But wait, let's get to know Ken Jeong before you go!





Words you should hear
56 genres of dance, yelling out a "Chow", a convertible, I'm not burdened with that, host an award show, I just totally freaked out, Flavor Flav impression, medical expertise, slapdogs, their lady-parts, gross bad Asian joke, I'm locked in, I don't give a crap, small dongs, back to the vaginas, "Holla city of squala!"



Super talented actor! Unlimited jokes and brilliant ideas in the making of the movie! How many actors can really do this? Look at the NG cuts below.



Vocabulary:
convertible -- (n)[C]


expertise -- (n)[U] a high level of knowledge or skill

Resources:
Ken Jeong @ Wikipedia
http://en.wikipedia.org/wiki/Ken_Jeong

Convertible @ Wikipedia
http://en.wikipedia.org/wiki/Convertible

Flavor Flav
http://en.wikipedia.org/wiki/Flavor_Flav

Lopez Tonight - Guest : Ken Jeong @ YouTube
http://www.youtube.com/watch?v=E9RMvCiKQJc&feature=related

The Hangover Part II - Trailer @ YouTube
http://www.youtube.com/watch?v=ohF5ZO_zOYU&feature=player_embedded

Ken Jeong 2011.05.23 @ YouTube
http://www.youtube.com/watch?v=x5eiCuwc1Sw&feature=related

The Hangover The Madness of Ken Jeong @ YouTube
http://www.youtube.com/watch?v=zWHoOXE_MIs

http://dictionary.cambridge.org/dictionary/british/expertise?q=expertise

Wednesday 22 June 2011

Vocabulary & Song: Relationships & The Tennessee Waltz -- Patti Page


Image from Bless Your Heart
There are many terms we use in a relationship, but of course, some are more intriguing than others. Say, the situation you see above and below, how do we call the odd one out?
Image from ...A PENNY FOR MADDE'S THOUGHTS...
Image from goenglish
You are right! We call the odd-one-out "the third wheel".

Person who is usually the third wheel actually doesn't want to get involved, but sometimes, it is not for them to choose.

Some people are involved in a love/hate relationship, in which they feel both love and hate for the same person.
Image from data.whicdn
Maybe the last one I will teach today is how we say if a third party intrudes into a relationship and wins the competition. We call it "steal sb from sb". Listen to this classic song 'The Tennessee Waltz" by Patti Page. It is also my favourite.


Lyrics
I was waltzing with my darlin' to the Tennesse waltz
when an old friend I happened to see.
I introduced him to my loved one,
and while they were waltzing
my friend stole my sweet-heart from me.

I remember the night and the Tennessee waltz.
Now I know just how much I have lost.
Yes I lost my little darlin' the night
they were playing the beautiful Tennessee waltz.

I was waltzing with my darlin' to the Tennesse waltz
when an old friend I happened to see.
I introduced him to my loved one,
and while they were waltzing
my friend stole my sweet-heart from me.

I remember the night and the Tennessee waltz.
Now I know just how much I have lost.
Yes I lost my little darlin' the night
they were playing the beautiful Tennessee waltz.


Vocabulary:
a fifth/third wheel -- (n)[C] US someone who is in a situation where they are not needed or are ignored by most people
involved -- (adj) being in a close relationship with someone
a love/hate relationship -- (n) a relationship in which you have feelings of love and hate for someone or something
intrude (into) -- (vb)[I] to go into a place or situation in which you are not wanted or not expected to be
steal sb from sb -- when a third party intrudes into a relationship and wins the competition.




Resources:
The Tennessee Waltz - singer Patti Page 1950 @ YouTube
http://www.youtube.com/watch?v=_Ek3eCbfqp0

Patti Page @ Wikipedia
http://en.wikipedia.org/wiki/Patti_Page

http://dictionary.cambridge.org/dictionary/british/a-fifth-third-wheel?q=third+wheel#a-fifth-third-wheel__1
http://www.urbandictionary.com/define.php?term=third%20wheel

http://dictionary.cambridge.org/dictionary/british/involved_2

http://dictionary.cambridge.org/dictionary/british/relationship_2#relationship_2__3

http://dictionary.cambridge.org/dictionary/british/intrude?q=intrudes#intrude__3

Monday 20 June 2011

Song: Back To December -- Taylor Swift


Image from thehollywoodgossip

A midtempo pop song that talks about how much a girl regrets treating her boyfriend badly and requested for a break-up in exchange for freedom, in the end realised that she was wrong and she didn't realise how much she was blessed with when they were together.

I like the continuous singing at the chorus, this is the best part of the song!

An excellent narrative song. A sad sad sad song...

Lyrics (modified and corrected)

I’m so glad you made time to see me
How’s life, tell me how’s your family
I haven’t seen them in a while
You’ve been good, busier than ever
Small talk, work and the weather
Your guard is up and I know why
Because the last time you saw me
Is still burning in the back of your mind
You gave me roses and I left them there to die

[Chorus]
So this is me swallowing my pride
Standing in front of you saying I'm sorry for that night
And I go back to December all the time.
It turns out freedom ain’t nothing but missing you
Wishing I'd realized what I had when you were mine
I go back to December turn around and make it all right
I go back to December all the time.

These days I haven’t been sleeping
Staying up late playing back myself leaving
When your birthday passed and I didn’t call
Then I think about summer all the beautiful times 
I watched you laughing from the passenger side
And realized I loved you in the fall
And then the cold came and the dark days
When fear crept into my mind
You gave me all your love
And all I gave you was goodbye

[Chorus]
So this is me swallowing my pride
Standing in front of you saying I’m sorry for that night
And I go back to December all the time.
It turns out freedom ain’t nothing but missing you
Wishing I realized what I had when you were mine
I go back to December turn around and change my own mind
I go back to December all the time.

I miss your texting, your sweet smiles.
So good to me, so right
And how you held me in your arms that September night
The first time you ever saw me cry
Maybe this is wishful thinking
Probably mindless dreaming
If we loved again I swear I’d love you right
I’d go back in time and change it but I can’t
So if the chain is on your door I understand

[Chorus]
But this is me swallowing my pride standing in front of you saying I'm sorry for that night
And I go back to December
It turns out freedom ain't nothing but missing you
Wishing I'd realized what I had when you were mine
I'd go back to December turn around and make it all right
I'd go back to December turn around and change my own mind
I go back to December all the time
All the time

Vocabulary:
swallowing my pride -- lowering down one's pride
playing back myself leaving -- recalling the moment when she was leaving like "play back" using VHS.
wishful thinking -- (n) [U] the imagining or discussion of a very unlikely future event or situation as if it were possible and might one day happen
mindless -- (adj) stupid and meaning nothing
swear -- (vb) [I or T] to state or promise that you are telling the truth or that you will do something or behave in a particular way
chain is on your door -- the ex-boyfriend's door is locked by a chain, meaning that the girl is not welcome.


Resources:
Taylor Swift - Back To December
http://www.youtube.com/watch?v=QUwxKWT6m7U&feature=player_embedded

Back to December @ Direct Lyrics
http://www.directlyrics.com/taylor-swift-back-to-december-lyrics.html

http://dictionary.cambridge.org/dictionary/british/wishful-thinking?q=wishful
http://dictionary.cambridge.org/dictionary/british/swear_2

Friday 17 June 2011

Investment: Why Groupon Is Poised For Collapse

Wow, haven't read articles as insightful as this one for a long time! Everyone who is trying to advertise through Groupon or the likes of it, check this out!


Why Groupon Is Poised For Collapse
Rocky Agrawal Jun 13, 2011
Editor’s note:This guest post is part of an in-depth series looking at the daily deal industry written by Rocky Agrawal, an entrepreneur who has worked on local products since 1995.  Read Part I, Part II, and Part III also.  He blogs at reDesign and Tweets @rakeshlobster.

Imagine you’re a small business owner. You have to choose between two propositions:
  1. You can pay $62,500 for marketing. You’ll get a whole lot of customers coming through your door. No guarantees if they will ever come back, but they’ll come once.
  2. I’ll pay you $21,000. You get $7,000 in about 5 days, another $7,000 in 30 days and the remainder in 60 days. In exchange, you’ll give my customers cheap products for the next year.
I’ve been working on local for a long time and I know it’s hard to get small businesses to spend money on advertising. Really hard. Even getting $200 a month ($2,400 a year) is a high hurdle to meet.
There’s no way a business will sign up for #1. Most merchants would laugh you out of the store if you asked for $60,000.
Except they are. In droves.
Although they sound completely different, #1 and #2 are really the same—it’s the Groupon business model.
Businesses are being sold incredibly expensive advertising campaigns that are disguised as “no risk” ways to acquire new customers. In reality, there’s a lot of risk. With a newspaper ad, the maximum you can lose is the amount you paid for the ad. With Groupon, your potential losses can increase with every Groupon customer who walks through the door and put the existence of your business at risk.
Groupon is not an Internet marketing business so much as it is the equivalent of a loan sharking business. The $21,000 that the business in this example gets for running a Groupon is essentially a very, very expensive loan.  They get the cash up front, but pay for it with deep discounts over time.  (This post applies to Groupon operations in the United States and Canada; it’s different in other parts of the world.)
In many cases, running a Groupon can be a terrible financial decision for merchants. Groupon’s financials also raise questions about its ongoing viability. Buying Groupon stock could be as bad a deal for investors as running a Groupon offer is for merchants.  This is my opinion, but I have some facts to back it up.
Traffic is not necessarily profitable traffic
Groupon can clearly deliver customers. But in order to know if it makes financial sense as a customer acquisition tool, merchants need to know two key numbers:
  1. The proportion of Groupon customers who are already their customers
  2. How often new customers come back.
The higher the first number, the worse their deal will perform. The higher the second number, the better their deal does.
But for most businesses, these critical numbers are impossible to know. Groupons haven’t been out long enough to generate this data.  And Groupon’s tracking methods aren’t collecting this data. (My intuition is that Groupon doesn’t want to know.)
Groupon touts a win-win proposition. But the reality is that Groupon usually wins and merchants usually lose. The merchant agreement is one of the most lopsided I’ve seen.
It’s rare that Groupon loses . . . until merchants figure out how to cheat.
The hidden auction
Underlying Groupon’s success is an auction. It’s not explicit, like Google’s AdWords bidding platform, but the economic effects are similar. The fact that Groupon runs daily deals creates artificial scarcity and drives up pricing to absurd levels. Even with four deals a day in a given market, you’re talking about fewer than 1,500 deals a year.
The “bid” in this auction is the total revenue that goes to Groupon. That’s a function of the value of the voucher, the negotiated revenue share and the number of deals that will be sold. The number of deals that will be sold is a function of, among other factors, how deep a discount and how commonly needed the product is. The larger the discount, the greater the volume.
All of this creates an incentive to drive up Groupon’s revenues. It also provides an incentive for salespeople to sell bigger and bigger deals, some of which might not be suitable for a small business. Because of all the hype around Groupon, salespeople are able to use the “Who’s Who” model—sell what an honor it is to be specially selected to be featured on Groupon.
Groupon’s process for selecting which deals it runs has little transparency. It’s not always the highest bids that win; sometimes, lower value bids win just to keep subscribers opening their emails. (In this case, think of merchants bidding with discounts, so the deeper the discount, the higher the bid).  I’ve also heard from merchants who say Groupon has changed their deals at the last minute to make them more profitable for Groupon.
Cash is king
Many small businesses are struggling for cash and the Groupon sales pitch resonates. Marketing with no upfront payment. You get cash within days. A steady stream of customers. This is not a new idea. Rewards Network has been offering restaurants cash upfront in exchange for discounted meals over time. (But on more generous terms than Groupon.)
Groupon’s S-1 calls tough economic times a risk; but the recession was really their opportunity. As other forms of credit dried up, struggling businesses jumped at the chance to get cash now in exchange for discounting their product later. The real risk for Groupon is that the economy improves to the point that businesses don’t have to resort to deep discounting.
Repeat Groupon businesses
Some of the analysis of Groupon’s long term prospects has pointed to repeat Groupon offers from merchants as evidence of a viable long-term model.
How can a repeat customer be bad, right? For a Groupon merchant, a repeat customer is a great thing. But for Groupon itself, a repeat customer can be a sign of trouble ahead.
I had been struggling to understand why some businesses ran repeat Groupons or cycled among the various daily deal vendors, given that the economics clearly suck if you can’t drive repeat traffic. Some let the same customer buy 3 or more of the same deal. That’s a clear no-no for a loss-leader designed to acquire new customers.
A conversation with Forkfly (a Groupon Now competitor) CEO Paul Wagner was enlightening. He suggested that they were doing what struggling families do when they max out a credit card—they get another one.
That makes perfect sense. Revenue from subsequent daily deals help pay for the obligations created by the first one.
Receipts look like the one at right. Lots of product going out, staff to pay and little cash coming in. Taking out another Groupon loan is a quick fix. (If I were a sales rep, I’d have that date marked on my calendar for follow up. “I know we did 50/50 last time, but I’m thinking Groupon gets 70% this time.”)
Hacking Groupon
How would you exploit an overpriced loan? Don’t pay it back.
Assume that you’re a business that is unscrupulous and you’re looking to make a quick buck. You could create a wildly generous deal that would sell like crazy. In about 30 days, you’ll have 2/3 of your share of the deal. Then you shut down operations.
It also works for businesses that are just having a tough time. As critical as I am of Groupon, the slam dunk case is to sign up with Groupon if you’re going bankrupt. I strongly encourage every business that is about to go under to call Groupon. (Don’t tell them Rocky sent you.) It makes total financial sense—as a Hail Mary play. If you’re lucky, the upfront cash will be enough to help you stay afloat. If not, well, you were already going out of business. It may be your best option. In the short term, you’re actually helping Groupon because they’re being valued on revenue and no one is taking into account risk.
Groupon is essentially holding a portfolio of loans backed by the receivables of small businesses. If a business goes under, consumers will come back to Groupon for their money back. Unless Groupon is actually doing credit assessments on businesses that it chooses to feature, this is a big risk for Groupon.
The onerous terms for participating in Groupon also create an adverse selection problem. The most successful businesses don’t need Groupon for customer acquisition or financing.
The assumption is that nothing will go wrong and all of these “loans” will be paid back. (At least the subprime mortgage lenders were able to sell that risk off to Wall Street and AIG.)
Like the mortgage lenders, Groupon doesn’t know exactly how much risk it has piled up. Because some merchants track redemptions on paper, Groupon has no way of knowing how many unredeemed Groupons are outstanding. If a business goes under and the records are unavailable, every buyer of that Groupon could try to make a claim against it. (The risk is mitigated by the fact that a lot of redemption occurs within the first 60 days, but we don’t know how much.)
Google, with more than $36 billion in cash on hand, is uncomfortable enough with that risk that it dumps it onto Google Offers buyers. Groupon could mitigate this risk by changing its terms and conditions so that the consumer is responsible in case a merchant goes bankrupt.
Relying on float
Where does Groupon get all the money to give to these merchants? Credit cards—yours. Groupon gets paid within a couple of days by its banks. It then takes that money and gives it to the merchant in three chunks. From Groupon’s S-1:
Our merchant payment terms and revenue growth have provided us with operating cash flow to fund our working capital needs. Our merchant arrangements are generally structured such that we collect cash up front when our customers purchase Groupons and make payments to our merchants at a subsequent date. In North America, we typically pay our merchants in installments within sixty days after the Groupon is sold.
We use the operating cash flow provided by our merchant payment terms and revenue growth to fund our working capital needs. If we offer our merchants more favorable or accelerated payment terms or our revenue does not continue to grow in the future, our operating cash flow and results of operations could be adversely impacted and we may have to seek alternative financing to fund our working capital needs.
Translation: They’re using money from new deals to pay for previous deals. They need to keep growing revenue. As of March 31, they owed merchants $290.7 million.
In the agreement I’ve seen, the first installment is 33% in 5 days. If they have to pay merchants faster, that could lead to problems.
And Google might force that to happen. According to Google Offers’ payment terms, merchants receive 80% of their share in 4 days—more than twice as much, 1 day earlier.
There’s no way that was an accident.
If Groupon matches these payment terms, they’ll need cash faster and need to grow faster. (Google Offers accelerates the rate at which Groupon’s scheme has to draw in new suckers.)  If Groupon doesn’t match, it gives Google a key differentiator to win deals. If those businesses  go with Google’s more generous terms, that too will starve Groupon of the cash it needs to pay earlier merchants.
Now here’s the crazy part.  Not only is Groupon effectively giving loans to merchants, but it also works the other way around.  The merchant is on the hook for the entire value of those deals until Groupon pays the merchant back its portion.  Unlike other loan providers, the merchant is making a short-term loan to Groupon. (Not technically, but effectively.) They buy inventory in advance of the Groupon run. They also serve the initial rush of customers. The business is in a hole before they get their 30- and 60-day Groupon payouts.
While the chances might be small, Groupon merchants should know that they’re taking on the risk of Groupon’s collapse. If Groupon collapses, a lot of small merchants could be left holding the bag.
If you know of a business that closed after running a Groupon or other daily deal, please send an email with the name of the business to dailydeals@agrawals.org. And remember,correlation is not causation.
Photo credits: Rachel Lovinger photo of Lisa Greenfield’s House of Cards and Rocky Agrawal.


Opinions:
For our American readers, are you still in line for the Groupon IPO? For our Hong Kong readers, are you a customer or a small business owner? No matter who you are, we all need to be careful, you don't want more Yoga-centre-closure to happen to you just because you have bought some coupons.



Resources:
Why Groupon Is Poised For Collapse @ Tech Crunch
http://techcrunch.com/2011/06/13/why-groupon-is-poised-for-collapse/