Google yearning for Yelp?

Matt Bowman · December 18, 2009 · Short URL:

A rumored deal of over $500 million could signal heated competition with Bing for content

 YouTube aside, Google has generally steered clear of user-generated content plays. YouTube’s difficulty generating revenue is explanation enough. That makes its rumored acquisition of Yelp all the more interesting. Why do it?

At a rumored $500 million, the deal would certainly be good for Yelp, which is seeing increased competition from location-based mobile applications. Yelp has continued to innovate in the last year, bringing the first augmented reality app to the iPhone store, and with a reported 8.5 million reviews, it’s still the largest user-generated local reviews company, but other sticky social networks and applications are putting the heat on.

Google, which has had to import social results from Twitter and has seen its own social network experiment, Orkut, fall flat in the U.S., may be recognizing it needs to “buy social,” in order to stay sticky.

Then there’s the rise of mobile and location-based technology. Local impulsive search is a huge growth market. Google already has the hard info down pat: coordinates, business names, streetviews. But soft info like the best place to eat is still anyone’s game, and so far, Yelp is in the lead.

But Google is already tapping into Yelp intelligence, leaning heavily on the company for the content on its Place Pages. Why buy it if you can just use it? One possible answer is Bing. Like Murdoch, Yelp may realize it finally has a way to leverage its content assets, and giving one search engine exclusive rights would be a big Bing ding for competitors.

Another plus for Goog is the talent and intelligence grab. Don’t forget that Yelp, like YouTube, was founded by a PayPal alum. It’s hard to go wrong with more of them on staff.

Yelp has raised at least $30 million in the last 5 years, from Bessemer Venture Partners, Benchmark Capital and DAG Ventures.

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Yelp is the fun and easy way to find, review and talk about what's great (and not so great) in your world. You already know that asking friends is the best way to find restaurants, dentists, hairstylists, and anything local. Yelp makes it fast and easy by collecting and organizing your friends' recommendations in one convenient place.

Yelp is...

...the ultimate city guide that taps into the community's voice and reveals honest and current insights on local businesses and services on everything from martinis to mechanics.

...just real people, writing real reviews, and that's the real deal.

...a fun and engaging place for passionate and opinionated influencers to share the experiences they've had with local businesses and services.

...the definitive local guide in the San Francisco Bay Area and a force to be reckoned with in Chicago, New York, Boston, Los Angeles and Seattle. But really, we're everywhere. From Austin to Madison and everywhere in between, reviews are coming in from all over the country!

...word of mouth marketing - amplified. Savvy local marketers now have a great channel to effectively target local consumers.

Since July 2004, co-founders Jeremy Stoppelman (CEO) and Russel Simmons (CTO) and their Yelp crew have been striving to make life better for people who love to patronize great local businesses. Discovering accurate information on local establishments has never been this entertaining. Writing reviews has never been this fun, easy and addictive!

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