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Yelp Files For $100 Million IPO

techcrunch.com

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Re: Yelp Files For $100 Million IPO

#21

Post by shawnee_ »

Yelp's motto: 'Let's legalize extortion!'

Built a review site? Fine, but leave the reviews alone. All of them. No, it is not "OK" to close users' accounts with no warning, thereby demolishing all of their reviews. No, it's not OK to "hide" some reviews or to take down reviews when your blackmail tactics actually work. No, Yelp: it's not acceptable to solicit and harass people and businesses who have explicitly posted "no soliciting" signs on their establishments.

Show investors your business model transparently, let's see it. How is this supposed to work legally? Is this really going to be sustainable or build value in the long-term?

If Yelp's public offering gives them anything substantial, we have a lot to worry about. If the IPO market says it's OK for companies to make money by extorting the little guy and stifling the small voices, we are in a world of trouble.

Re: Yelp Files For $100 Million IPO

#22

Post by omarchowdhury »

amanfredi wrote: post #16
earl wrote: post #10

Earlier quoted context omitted.

No, I think the gp is referencing the fact that 75 (seriously, 75!!!) percent of yelps traffic comes in from google [1]. You have to view that as basically a failure of the company and the brand. Instead of going to yelp for a review, people just search in google. This also obviously leaves them enormously exposed to changes in Google's algorithms, whether intended to affect yelp or not. (Cue the google employees wit…

This isn't really fair. In Chrome DNS has practically been replaced by google search, and it's great. Instead of typing yelp.com (or was it yelp.net? www.yelp.biz? http://www.yelp.info? ) I can just type "yelp" and get where I'm going without having to remember the exact url and without getting an annoying error page if I make a typo. I suspect for many users even in other browsers the search box gets much more use t…

Long tail search traffic related to local businesses is the key here, not people attempting to navigate to Yelp through Google.

Re: Yelp Files For $100 Million IPO

#23

Post by DevX101 »

dmix wrote: post #4
vaksel wrote: post #2

they are too dependent on Google, which is why they were silly to walk away from their offer.

I love how everyone becomes armchair experts on the decisions tech companies made when they try to IPO.

I don't disagree with your diagnosis of the prevalence of armchair CEOing around here, but Yelp is indeed concerned about Google.

Yelp and a couple other companies forced in Google to a Congressional hearing where senators attacked Google over having too much power over other sites. Yelp gets a SIGNIFICANT amount of its traffic from google searches. So if Google arbitrarily decided to promote its own restaurant reviews from Zagat after a user search, this would crush Yelp's traffic.

Re: Yelp Files For $100 Million IPO

#24

Post by mattmanser »

cantbecool wrote: post #19

Why do people think they can turn it around, i.e., make profit? Yelp has been around since 2004, that is a good seven years to show that they can generate at least minimal profit, and if Yelp is not profitable yet, there is a decent chance they never will be. Yelp is not Amazon, they are a crowd-sourced review site. Growth is great, but operating in the black is better. That's just my opinion though. So feel free to…

No criticism here, it's purely to sell it on to someone else, it's bull all the way until someone realizes they're still not making profits!

Re: Yelp Files For $100 Million IPO

#25

Post by prawn »

amanfredi wrote: post #16
earl wrote: post #10

Earlier quoted context omitted.

No, I think the gp is referencing the fact that 75 (seriously, 75!!!) percent of yelps traffic comes in from google [1]. You have to view that as basically a failure of the company and the brand. Instead of going to yelp for a review, people just search in google. This also obviously leaves them enormously exposed to changes in Google's algorithms, whether intended to affect yelp or not. (Cue the google employees wit…

This isn't really fair. In Chrome DNS has practically been replaced by google search, and it's great. Instead of typing yelp.com (or was it yelp.net? www.yelp.biz? http://www.yelp.info? ) I can just type "yelp" and get where I'm going without having to remember the exact url and without getting an annoying error page if I make a typo. I suspect for many users even in other browsers the search box gets much more use t…

Further to that, it's usually quicker to Google for "yelp las vegas restaurants" than it is to get to Yelp and then search or browse from there.

Re: Yelp Files For $100 Million IPO

#26

Post by yannickt »

marquis wrote: post #18
amandalim89 wrote: post #5

Earlier quoted context omitted.

google was offering much less than what Microsoft was bringing to the table ($700M) - and they turned that down too. I think if Google up their bid (at least trying to match Microsoft's) Yelp might have gone for it just because it was Google. http://news.accuracast.com/internet-7471/yelp-turned-down-mi... I think Google should have just paid more and buy Yelp rather than Zagat.

I'd rather see Zagat succeed than Yelp.

Why?

Re: Yelp Files For $100 Million IPO

#27

Post by pg_bot »

Why are all these recent tech companies that have gone through an IPO not able to turn a profit? Groupon, Pandora, LinkedIn, and now Yelp are all valued so highly yet they are not making money off of their services. If you have been in business for over 5 years and don't make a profit when are you expecting to?

Re: Yelp Files For $100 Million IPO

#28

Post by betterlabs »

Yelp is an awesome service, but I am surprised to see that they are still not profitable. Considering an annual revenue run rate of approx. $70m, I am wondering what costs them $70m a year to run the site - with most online businesses salaries and marketing are the biggest expenses and considering Yelp's amazing organic rankings, I doubt they are buying a lot of traffic. Any idea what the other big costs are? Sales teams, perhaps?

Re: Yelp Files For $100 Million IPO

#29

Post by meowzero »

betterlabs wrote: post #28

Yelp is an awesome service, but I am surprised to see that they are still not profitable. Considering an annual revenue run rate of approx. $70m, I am wondering what costs them $70m a year to run the site - with most online businesses salaries and marketing are the biggest expenses and considering Yelp's amazing organic rankings, I doubt they are buying a lot of traffic. Any idea what the other big costs are? Sales t…

Well they seem to be sacrificing ad space for user experience. They only have 1 ad on each page, unlike other sites that have multiple.

Re: Yelp Files For $100 Million IPO

#30

Post by mkr-hn »

betterlabs wrote: post #28

Yelp is an awesome service, but I am surprised to see that they are still not profitable. Considering an annual revenue run rate of approx. $70m, I am wondering what costs them $70m a year to run the site - with most online businesses salaries and marketing are the biggest expenses and considering Yelp's amazing organic rankings, I doubt they are buying a lot of traffic. Any idea what the other big costs are? Sales t…

Probably paying people to go out and try places to review. Organic traffic (and ad revenue) comes from having content, so it's a good investment.
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