Andrew Mason
Andrew Mason is an American entrepreneur best known as the founder of Groupon, a Chicago-based company that revolutionized local commerce through discounted gift certificates. The concept of Groupon emerged from Mason's earlier project, The Point, which aimed to encourage collective action among users for social initiatives. Born on October 22, 1980, in Pittsburgh, Pennsylvania, Mason grew up in an entrepreneurial household and demonstrated his own business instincts early on with ventures like a bagel delivery service during his teenage years.
Mason's entrepreneurial journey led to the creation of Groupon, which utilizes a model where deals become active only if enough customers express interest, thereby leveraging collective purchasing power. Under Mason’s leadership, Groupon gained significant traction, attracting millions of customers and substantial venture capital investment. However, after facing challenges following its initial public offering, Mason stepped down as CEO in 2013.
Post-Groupon, he explored various ventures, including launching Detour, an app for GPS-guided city tours, and later founded Descript, a collaborative tool for content creation that incorporates advanced AI features. Mason is married to singer-songwriter Jenny Gillespie, and they have one child.
Subject Terms
Andrew Mason
- Born: 1981
- Place of Birth: Pittsburgh, Pennsylvania
Introduction
Andrew Mason is the founder of Groupon, a Chicago-based Internet company that offers discounted gift certificates that are localized to major markets. The name is a composite of the words group and coupon. He also founded an audio and video editing tool, Descript.
Early Life
Andrew Mason was born October 22, 1980, in Pittsburgh, Pennsylvania, and grew up in the suburb of Mt. Lebanon. Both his parents were entrepreneurs. His father sold diamonds, and his mother had a photography business. Mason's entrepreneurial spirit emerged at age fifteen, when he started a Saturday-morning bagel delivery service called Bagel Express. He graduated from Mt. Lebanon High School in 1999 and enrolled in Northwestern University, where he earned a bachelor's degree in music in 2003.
After college, he worked in web design and at Electrical Audio, the studio of recording engineer Steve Albini (producer of hundreds of albums and member of the bands Big Black and Shellac, among others), whom Mason credits as an influence. He briefly attended the University of Chicago's Harris School of Public Policy in the master's program but dropped out after a semester.
Life's Work
Mason's first online entrepreneurial effort was The Point, funded with $1 million in seed money from Eric Lefkofsky, an Internet entrepreneur with a mixed reputation for whom Mason had worked after college. The Point was named for Malcolm Gladwell's 2000 book The Tipping Point, which examines processes of sociological change. The Point was a social initiatives site, but Mason had difficulty marketing it and in 2008 dismantled most of its features in order to turn it into Groupon. Mason has credited the idea for The Point with an origin story that may be apocryphal: Having trouble canceling his cell phone contract, he found himself wishing he could take collective action with other people having the same problem in order to leverage their power. The way The Point was supposed to work was that users would commit to participation in some social initiative as long as the total number of participants exceeded a certain threshold. This could involve monetary donations. For example, Mason proposed a $10 billion project to build a dome over Chicago to protect it from snow, which yielded $234,395 worth of pledges. Monetizing The Point was a challenge, however, and it eventually folded.
Groupon preserves the “this will happen if enough people participate” element: the idea of using a crowd to leverage collective power, and little else. Groupon, which has since inspired numerous similar sites, acts as a middleman between businesses and local customers and then offers a deal to customers who have signed up for e-mail notifications. If the number of customers who accept the deal exceeds a certain number, the deal is made official (and credit cards charged accordingly). Typically, the deals are for about half off of some local product or service, such as a spa service, car wash, or restaurant meal. Groupon takes 50 percent and the fee for processing credit cards, giving the balance to the local business. Instead of leveraging the power of a crowd to enact social change, Groupon leverages the crowd in order to get a discount.
One of the keys to Groupon's success is Mason's insistence on copywriting that is compelling: Brandon Copple, the former managing editor of Crain's Chicago Business, was hired as Groupon's managing editor and oversees a staff of copywriters who are given a manual the size of a midsized city's phone book. Groupon deals are meant to be interesting to read. This is a solid sales technique—the longer customers spend reading the pitch, especially if they are entertained by it, the more positively disposed they will be toward accepting the sale—and it helps define Groupon's brand identity.
A former Yahoo president, Rob Solomon, was hired to help shape Groupon's infrastructure in 2010. One of the experiments launched was the “hyperlocal” deal—a deal offered to specific neighborhoods of large metropolitan areas such as Chicago, New York, and London.
In 2010, Groupon received $135 million in venture capital from Digital Sky Technologies, Battery Ventures, and other groups, at which point it had sold more than 6 million deals. That May, it acquired CityDeal, a European copycat site, in order to add Groupon coverage to eighty more cities in sixteen countries. Later in the year, Groupon turned down a $5.3 billion acquisition bid from Google. Much of Groupon's appeal for investors and potential buyers is how effectively it has monetized the Internet, whereas many dot-coms (Twitter, for instance) do not appear to have monetization models that are equal to their popularity, particularly since the Internet generally eschews paying for online services.
In 2011, Groupon issued an initial public offering (IPO), trading as GRPN on the NASDAQ, and Mason's 45.9 million shares, at a stock price of $27.90, made him a billionaire—and made billionaires of Lefkofsky (Groupon's biggest shareholder) and Brad Keywell, Lefkofsky's longtime business partner. However, after going public in November, Groupon reported a loss of revenues in February, at a time when investors expected profits to be reported.
As a result, 2012 saw challenges for Groupon, and in February 2013, Mason was forced out as CEO. Later that year, he recorded a tongue-in-cheek rock album called Hardly Workin', intended as a motivational album for people starting careers in business. In 2015, Mason launched a startup called Detour, which offers a smartphone app with GPS-enabled guided tours of major cities, many of them narrated by prominent figures such as filmmaker Ken Burns and radio host Richard Steele.
Bose acquired Detour in 2018, and Mason turned his attention to a new venture, Descript. This tool can be used to collaborate, edit, record, transcribe, write, and share videos and other media. Descript quickly became popular with people creating content such as podcasts and videos. In 2022, Descript added a range of artificial intelligence-powered features, including automatic removal of filler words, noise reduction, and voice cloning. It added SquadCast for remote recording in 2024.
Personal Life
Mason is married to singer/songwriter Jenny Gillespie. They have one child.
Bibliography
"Andrew Mason." Descript Blog, 2023, www.descript.com/blog/author/andrew-mason. Accessed 16 Oct. 2024.
De la Merced, Michael J. "Remembering the Long, Strange Trip of Groupon’s Now-Fired Chief." The New York Times, 28 Feb. 2013, dealbook.nytimes.com/2013/02/28/remembering-the-long-strange-trip-of-groupons-now-fired-chief/. Accessed 16 Oct. 2024.
Graham, Meg. "Groupon Founder Andrew Mason Adds Chicago to Detour Audio Tours." Chicago Tribune, 1 Sept. 2016, www.chicagotribune.com/2016/09/01/groupon-founder-andrew-mason-adds-chicago-to-detour-audio-tours/. Accessed 16 Oct. 2024.
"Groupon and Descript: Andrew Mason." WNYC, 9 Sept. 2024, https://www.wnyc.org/story/groupon-and-descript-andrew-mason/. Accessed 16 Oct. 2024.
Qualman, Erik. Socialnomics: How Social Media Transforms the Way We Live and Do Business. New York: Wiley, 2010.
Sennett, Frank. Groupon's Biggest Deal Ever: The Inside Story of How One Insane Gamble, Tons of Unbelievable Hype, and Millions of Wild Deals Made Billions for One Ballsy Joker. New York: St. Martin's, 2012.