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Yelp Eyes Future IPO

the ballmaster — Mon, 22 Feb 2010 17:58:18 +0000

It’s official: Yelp has now turned away more suitors than Penelope, the long-suffering wife of Odysseus.

In December, the blogosphere reeled at the announcement that Google was stepping-up to buy restaurant-review site for a cool $500 million. Not bad for Yelp, considering it brief history as a startup, nor for Google, considering its botched attempts to dominate the local review market.

Observers did a double-take a few days later when it was announced that Yelp had walked away from the offer, citing fiduciary duty. It was further disclosed that an unnamed suitor was willing to pay more than 50% above Google’s offer price. Some observers correctly predicted that the only company desperate enough to make such an offer was Microsoft, which has never balked at paying excessive prices for a piece of the social networking pie. We now know that it was, indeed, Microsoft, which approached Yelp with an offer north of $700 million.

Which Yelp rejected.

Founder Jeremy Stoppleman is now sharing more details about his vision for the company, including a distant IPO:

Yelp “will definitely not go public this year,” he said. “2011, who knows? But why rush out the door if I can avoid it?”

This disclosure suggests at least a couple of things–

Yelp has enough cash in the bank to make it for a while, to which its recent injection of $100 million from private equity-shop Elevation Partners certainly attests.
Yelp estimates its true value north of $1 billion.
Yelp expects the IPO market for tech startups will significantly improve after 2010.

Time will tell if Yelp’s holdout strategy will work. It is a risky business, however, considering how quickly the market can turn against review sites.

Just ask CitySearch.

Yelp CEO Doesn’t See An IPO Anytime Soon.

Is Twitter Cherry-Picking its Metrics?

the ballmaster — Wed, 10 Feb 2010 21:05:40 +0000

Concerns have recently been voiced about Twitter’s user base: churn is over 90%, and the average number of tweets sent by a Twitter user is, er, 1.

Twitter, however, is undaunted by such stats, and, instead, promotes the fact that its monthly number of tweets continues to climb ever higher:

But what is the value of a tweet? Metrics I’ve seen range from a couple of cents to a few fractions of a cent. Is Twitter selecting the data that presents it in the best possible light, while ignoring the fact that its astronomic growth rate may have peaked? And how many of the tweets in the above graph are result of spam bots?

Now that Facebook, and, more recently, Google, have gotten into the realtime microblog scene, expect to see Twitter’s user base numbers continue to erode in the months ahead.

via Twitter Is Still Growing Rapidly [STATS].

Yelp Is Now In Play

the ballmaster — Tue, 22 Dec 2009 04:49:14 +0000

Wow. Not since Yahoo turned down Microsoft’s acquisition offer last year has the tech scene seen so much M&A drama. In a surprise move, Yelp’s board has rejected Google’s buyout offer of $500 million, citing its need to follow its fiduciary duty. This almost surely means that Yelp has received interest from another quarter.

The New York Times reports that this is, indeed, the case, and claims that the yet-unknown other party is willing to pay as much as 50% above Google’s offer for Yelp:

Yelp received interest from another company for a price of about 50 percent more than Google was willing to pay, according to a person who is close to the negotiations. That would put the price around $750 million.

This screams Microsoft, which is sitting on a lot of cash and has been known to overspend for a chance to get a piece of the social networking scene. (Remember its insane $15 billion valuation of Facebook three years ago?) Try as it might, Microsoft just cannot figure out how the hell to build a good social networking product.

Fiduciary duty, if narrowly interpreted, would lead Yelp’s board to accept Redmond’s higher offer– especially given the high premium Microsoft is willing to pay. The long-term interpretation of fiduciary duty, however, dictates that Yelp should run, not walk as far away from Microsoft as possible. What’s the last company that has flourished under Microsoft’s leadership? On the contrary, it seems that Microsoft suffers from that particular malady of not knowing what, precisely, to do with the companies it has overpaid to acquire.

A marriage of Yelp and Microsoft would yield some obvious synergies, including the integration of Yelp user content into Microsoft Maps and Bing, but this is merely a switching-out of search engines, as both functions are currently performed by Google. Care to see Yelp content filter into Microsoft Office? I don’t think so.

It’s easy to see what Microsoft gets out of this deal– a nice piece of the social media scene– something it hasn’t been able to figure out for the life of it. Hard to see what Yelp gets out of this deal except for a handsome payday.

via Yelp Turns Down Google, for Now – Bits Blog – NYTimes.com.

Google To Buy Yelp for At Least $500 Million

the ballmaster — Fri, 18 Dec 2009 21:52:38 +0000

Google, which has been on a buying spree for the past year, is in advanced talks to purchase Yelp for at least $500 million.

This is a smart move for Google in many ways. It had tried to usurp the world of local reviews earlier this year with its Place Pages– mini-sites that would show up at the front of search results pages and provide you with everything from the establishment’s address, phone number, location via Google Map, and user reviews. It would appear that, rather than reinvent the wheel, Mountain View has decided to pick up Yelp while the price is still relatively low. Doing so allows Google’s engineering team to focus on other areas; this price tag is largely about the value of Yelp’s user content.

This move by Google definitely serves as a shot across the bow to Microsoft and (to a lesser extent) IAC, whose CitySearch directory has been dying on the vine for the past seven years. It will be interesting to see how Microsoft responds.

Yelp has raised about $30 million across its four rounds of venture capital, and TechCrunch estimates the company’s value at $200 million.

Congrats to everyone at Yelp!

Google In Discussions To Acquire Yelp For A Half Billion Dollars Or More.

Microsoft and News Corp: The Enemy Of My Enemy?

the ballmaster — Mon, 23 Nov 2009 01:38:26 +0000

The Financial Times reported today that Microsoft is offering to pay News Corp to remove its content from Google’s search engine. This has become Microsoft’s preferred marketing approach: pay people to use your stuff… or, in this case, to not use someone else’s. We saw it with Bing Shopping’s double cashback earlier this year, and we’re seeing it again now.

That’s what a $25 billion war chest lets you do.

News Corp chairman Rupert Murdoch, meanwhile, has been taking his own hard line against Google, stating that he would use legal methods to stop Google from “stealing stories” from News Corp properties such as The Wall Street Journal. The puzzling thing with this approach is that no one is forcing publishers to have their content indexed by Google. It’s really quite simple: put a robots.txt file on your site, and– bam! –Google will no longer index your content.

Of course, you’d also be committing digital seppuku in the process, as Google probably drives the majority of your traffic, but hey.

via FT.com / Media – Microsoft and News Corp eye web pact.

Twitter Founder to Murdoch: Blocking Google Will Fail Fast

the ballmaster — Fri, 20 Nov 2009 03:56:03 +0000

As the race to save traditional news media continues, Twitter co-founder Biz Stone had some choice words to say about NewsCorp CEO Rupert Murdoch’s plan to prevent Google from spidering content on NewsCorp sites like The Wall Street Journal:

Instead of trying to “put the genie back in the bottle” and revert to an even more “ridiculously closed” model, Stone said Murdoch and co. ought to be thinking about how to make up lost revenue by embracing a radically new and open strategy.

Co-founder of LinkedIn Reid Hoffman joined in with similar sentiments: “I am sure that during the transition from horses to automobiles there were some people bemoaning the loss of horse transport.”

Such comments represent but one side in the debate, with Murdoch and Mark Cuban occupying the other corner. Ultimately, there is no rule that says one must allow Googlebot to spider all one’s premium content– unless you don’t mind the loss of traffic that will inevitably result. Given the explosion of lo-fi news sources (ahem… bloggers), it’s a real question whether people will care enough to give a micropayment for premium content.

My sense is that this effort will only succeed if Murdoch can bring over a significant number of popular premium content providers– The New York Times, Wall Street Journal, Washington Post, etc. Without such a cooperative, planting robots.txt on NewsCorp sites will only hurt NewsCorp… and benefit anyone else who is smart enough to see this as an opportunity to pick up share.

via Twitter Founder to Murdoch: Blocking Google Will Fail Fast.

Caselaw Now Searchable in Google Scholar

the ballmaster — Thu, 19 Nov 2009 01:34:43 +0000

Google is on a tear. Over the past several months, it has rolled-out several new products: FastFlip and Image Swirl among them. Now it has incorporated full-text legal opinions for state and federal courts into Google Scholar.

By adding caselaw into Scholar, Google is squarely taking aim and paid services like Westlaw and Lexis-Nexis. These companies will likely find themselves in a similar position to paid web analytics companies like SiteCatalyst when Google unveiled its free competitor, Google Analytics.

Hard to compete against free.

via Google Scholar’s Caselaw Finder: It Works! (GOOG).

Introducing Google Image Swirl

the ballmaster — Tue, 17 Nov 2009 23:01:17 +0000

Google just continues to shake up the world of online content distribution. Its recent foray into news content aggregation caused many to reconsider the possibilities inherent in online content syndication. Now, Google is shaking up the staid world of online image search.

Having launched Image Search back in 2001, Google is now looking for more interesting ways of grouping images together. Its newest product, Image Swirl, allows for more interesting relationships between images:

For example, if you search on Image Swirl for [washington], you’ll see 12 image thumbnails including President Washington, the Washington Monument, a map of Washington D.C. and the Capitol Building:

Once you find the group of images you’re interested in, you can click on the thumbnail and a cluster of images will “swirl” into view.

Presumably, Mountain View will be keeping a close watch on the types of groupings that attract the more user clicks– and will then apply these rules to new groups of images moving forward.

Things are going to get interesting. Check out Image Swirl here.

via Official Google Blog: Explore images with Google Image Swirl, now in Labs.

Down And Out With Yahoo Search

the ballmaster — Tue, 17 Nov 2009 22:54:16 +0000

In a discovery that will surprise no one, Yahoo is continuing to lose share in the search marketing arena to Google and Bing:

It’s heading in the wrong direction — toward zero. Yahoo represented 18% of the U.S. search market in October, according to comScore — an all-time low. Meanwhile, Google reached an all-time high at 65.4% of the market. And Microsoft’s Bing gained half a percentage point to 9.9%.

The picture really says it all.

Well, maybe not all. For starters, what will Yahoo do about this state of affairs? Some have suggested that it intends to get out of the search marketing business altogether– a sentiment seemingly reinforced by Yahoo CEO Carol Bartz’ recent comment that Yahoo wasn’t really a search engine. Others argue that given the size of the market, maintaining even a foothold is better than nothing, and certainly is worth Yahoo’s cost of doing business.

When these charts start to include Ask.com and Cuil, you’ll know it has become very, very bad for Yahoo.

via CHART OF THE DAY: Yahoo’s Search Business Is Toast (YHOO, GOOG, MSFT).

Google Takes On Twitter With Hot Trends Integration

the ballmaster — Tue, 29 Sep 2009 12:06:38 +0000

Google continues to launch skirmishes against anyone who would carve-out a piece of the Interwebs for itself. Consider:

It took on the shopping comparison engines in 2007 by including Google Product Search results at the top of its search results page.
It fired a shot across the bow at Wikipedia with Knol.
It is challenging local content sites like Yelp with its new Place pages.

And now it is going after Twitter with realtime search. Meet the new-and-integrated Hot Trends OneBox:

“The idea behind the [Hot Trends] OneBox is to not only provide you with search results as you’d want but also extra meta data on how popular the search is and whether it has peaked in interest, plus the number of sites that are creating chatter and buzz about this particular topic or person, to give a relative hotness rating as well” said RJ Pittman, director of product management for consumer search properties at Google.

The concept is simple: Google amasses a wealth of information about what people are searching for in its search logs. Google has long offered this info to those savvy enough to use Google Trends. Now, it is integrating these results on its search results pages, albeit at the bottom.

Will this take the steam out of Twitter’s much-vaunted realtime search? Time will tell. But you can be sure this is being discussed within Twitter, especially as there is considerable evidence that its explosive growth may be peaked.

via Take That, Twitter: Google Hot Trends Integrated Into Google Search.