Living Social closing Adventures business
Living Social closing Adventures business
Living Social is closing its three-year-old local Adventures business brand and shedding 30 employees in favor of lucrative, large-scale events as the daily-deals company searches for ways to make money.
“This was a business decision as we continue to focus on achieving profitability,” said Living Social Senior Vice President Doug Miller.
Miller said smaller, live-
produced events such as sushi rolling and paddleboarding cost too much, consume too many resources and are too small-scale to make them worthwhile.
“We have found great success in some of our bigger events — BeerFest, Sumo & Sushi, 5k Dance Party — that are designed to tour from city to city,” Miller said in an e-mail. “Therefore, we have made the decision to shift our focus from smaller locally-conceived events entirely to larger touring events.”
The company will team with partners, such as Tough Mudder and Cirque du Soleil, that allow them to promote live events across the United States.
News of the change was first reported in the Washington Business Journal.
Some of the 30 jobs will be lost in the District, where Living Social is headquartered. The rest will come from other offices. Living Social laid off 400 employees last year as it dealt with a decline in the daily-deals business. The company employs about 4,000 people worldwide, including 2,000 in the United States.
(Living Social chief executive Tim O’Shaughnessy is the son-in-law of Donald E. Graham, the chairman and chief executive of The Washington Post Co.)
— Thomas Heath
Buyers’ top concern is rising mortgage rates
In the current housing market, prices are high, the supply of homes is low and credit is tight. But the No. 1 concern for potential home buyers is rising mortgage rates, according to a recent online survey by real estate research firm Trulia.
More than 40 percent of people who planned to eventually buy a home said they were worried about rising rates, followed by rising home prices and low inventory. Among people planning to buy a home within the next year, inventory just edged out rising rates, the survey said.
The 30-year fixed rate touched 4.5 percent last week, according to data from Freddie Mac. More than half of home buyers said they would be discouraged from entering the market if rates reached 6 percent. Rates are still low by historic standards, but people have grown accustomed to them being below 4 percent, said Jed Kolko, chief economist at Trulia.
It’s logical for people to be worried about rising rates, Kolko said, but what they should really concentrate on is credit.
“Low mortgage rates don’t do much good if you can’t get a mortgage,” he said.
There are some signs that banks have started to loosen credit standards, Kolko said, but rising mortgage rates may help further loosen them. Mortgage credit availability increased in June compared with last year, according to data from the Mortgage Bankers Association.
— Amrita Jayakumar
Also in business
l Chrysler Group is recalling 45,961 Ram trucks because their electronic stability-control systems may not turn on when the vehicles start. Ram 1500 4x4 trucks built between June 26, 2012, and Feb. 5 are involved in the recall. Chrysler says a software problem may disable the electronic stability control system when the pickups start.
Goldman Sachs Group said Tuesday that quarterly profit doubled, boosted by investment gains and a lower tax rate. Goldman’s investing and lending segment, which tracks its investments in private-equity deals, publicly traded stocks, loans and bonds, produced nearly seven times as much revenue in the second quarter as in the same period last year. Overall, Goldman’s net income rose to $1.86 billion, or $3.70 per share, in the quarter, from
$927 million, or $1.78 per share, a year earlier. Analysts on average had expected $2.82 per share. Net revenue rose 30 percent to $8.61 billion.
l Coca-Cola said profit fell 4 percent last quarter, the second decline in a row, as sales were sapped by economic weakness in China and Europe, shifting tastes in the United States and unseasonable weather in places such as India. Net income fell to $2.68 billion, or 59 cents a share, from $2.79 billion, or 61 cents, a year earlier, Atlanta-based Coca-Cola said Tuesday in a statement. Excluding items such as restructuring charges and costs for productivity initiatives, profit was 63 cents a share. Revenue fell 2.6 percent, to $12.7 billion, for the first consecutive decline since the recession.
l Barclays and four former traders must pay $487.9 million in combined fines and penalties, the U.S. Federal Energy Regulatory Commission said in an order tied to an investigation of alleged manipulation of energy markets. The agency directed the company and traders to pay $453 million in civil penalties to the U.S. Treasury within 30 days, according to an order issued Tuesday. The London-based bank must also give up $34.9 million in profits, to be distributed to programs that help low-income homeowners pay energy bills in California, Arizona, Oregon and Washington, it said.
l MetLife, the nation’s largest life insurance company, said financial regulators have moved one step closer to placing it under tougher government supervision. The Financial Stability Oversight Council voted Tuesday to advance MetLife to the final stage of a three-step process for designation as a systemically important financial institution, a label that would subject it to oversight from the Federal Reserve. That would impose on the company a number of strict regulations, including setting aside more money to cushion against losses.
— From staff reports, news services
l 8:30 a.m.: Housing starts for June released.
l 10 a.m.: Federal Reserve Chairman Ben S. Bernanke testifies on monetary policy before House Financial Services Committee.
l 2 p.m.: Federal Reserve’s regional “beige book” reports.
l Earnings: Bank of America, eBay, IBM, Intel.