Deal sites have a rough year

Both Groupon and Living Social, both promising stars not long ago, both ran into financial and legal trouble in 2012.

Groupon CEO Andrew Mason
Groupon CEO Andrew Mason Dan Farber/CNET

Groupon, the company that made daily deals popular for consumers, has had a tough tumble. After finally going public late last year, the company faced massive competition, slowed growth in revenue and a decimated stock in 2012. In its early days, Groupon was a tech superstar, charging along on a mission to become the fastest-growing company in history. But as the months passed, the company was plagued by slumping stock, a shareholder lawsuit and the rumored unrest from employees trying to leave the company.

Much of the blame has fallen on the shoulders of CEO Andrew Mason, who once had a chance to sell the company to Google for $1 billion. Groupon's board of directors recently decided to keep the 31-year-old Mason on as CEO, despite the heat he's been catching for the company's struggles.

Competitor Living Social hasn't fared much better. After a net loss of $566 million in the third quarter, it laid off several hundred employees . It's also the target of a patent-infringement lawsuit by Blue Calypso , which previously sued Groupon over similar claims.

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