But along comes the mundane world of finance, where high-flying Groupon and Facebook are met with dismal ledger sheets and waning stock prices. Now it seems everyone is jumping off, forcing the PR teams to change direction from managing positive buzz to stopping a crisis of confidence.
This week the media reported that some of Groupon’s early investors cashed in their stock as they headed for the exit. And Facebook’s stock price has slid to half of what it was before the social network’s IPO, as original investors dump their shares.
It’s a tough job to keep notoriously fickle Wall Street investors happy, particularly with the well-established boom/bust record of Internet stocks. Everyone is looking for the next Internet boom companies, such as Google or eBay, but more often they get a Pets.com or Go.com.
As with any financial story, the devil is in the details, and that’s where these companies can score some PR wins for their reputations. For instance, although some early investors sold Groupon and Facebook stock, they did so at a huge profit. And the number of early investors who sold is matched by those who stayed on board with the companies.