Yelp
Encyclopedia
Yelp, Inc. is a company that operates yelp.com, a social networking
, user review
, and local search
web site. Yelp.com has more than 54 million monthly unique visitors as of late 2010.
, both of whom were early software engineering
employees at PayPal
, spun the service off as a separate company. After an aborted start as an email recommendation service, Yelp launched its namesake web site into the San Francisco market in October 2004. The company received $6 million in early funding from venture capital
firms Mission Street, led by another former Paypal-er Max Levchin
, and Bessemer Venture Partners
. Additional investments were made by Benchmark Capital
, DAG Ventures
, and a private Investor from Laguna Beach, who invested $3 million, $3 million, and $5 million respectively. Yelp expanded from its San Francisco roots to open an east coast office in Manhattan
in the first half of 2008 and by introducing a Canadian-focused version of the site in 2008. Yelp now has international sites in Spain, France, Germany, Austria, the United Kingdom and the Netherlands. As of 2008, Yelp's page view
count overtook its predecessor and early rival, Citysearch
. Revenues were approximately US$30 million for 2009, with $50 million to be expected in 2010.
On December 17, 2009, TechCrunch
reported that Yelp was in advanced negotiations with Google
to buy the company for more than $500 million. By December 21, the same source was reporting that Yelp's CEO had rejected the Google offer.
Yelp has been identified as a possible candidate for an IPO
by 2013.
In November 2011, Yelp filed with the SEC to raise up to $100 million in an initial public offering.
The site currently has more than 61 million monthly unique visitors across 13 countries.
Listings and related content are organized by city and a multi-tier categorization system. Content and listings can also be discovered through categorized reviews or via Yelp member profiles and their review lists. Maps leveraging Google Maps
show reviewed businesses to further aid in business discovery.
Information can be accessed by web or mobile browsers.
ing functionality to create a local online community
. Adding social web
functionality to user reviews creates a reputation system
, whereby site visitors can see which contributing users are the most popular, respected, and prolific, how long each has been a member, and which have interests similar to theirs. Peer feedback mechanisms, and placement of popular reviews on the site and in local market Yelp newsletters help motivate contributors. Yelp also has a "First to Review" reward system to create a competition among contributing members, further motivating the creation of reviews and adding to the site's business coverage.
The company strengthens the online community through off-line events at nightclub
s, bars, restaurants, and cultural venues in various cities for its most prolific and loyal contributors, named "Elite" members on the site. These members must provide a photo and their real name, be at least of legal drinking age, and not own a local business. In return these members receive a special badge on their personalized page for every year they author a specific number of reviews or contribute to the improvement of the online community. The concept is meant to indicate that the user is a trusted author of business reviews. To gain Elite status, it is often helpful to be nominated by other Elite users but recognition is bestowed when one writes useful, funny or cool reviews so members can vote on those reviews.
The site also has a forum
for online socialization and to discuss local businesses and events.
A number of competitors emulating these Yelp concepts have failed or were acquired.
, hotels, and cultural venues; and non-business locations such as schools, museums, parks, and churches.
San Francisco, the home city, remains the most active as of 2008, with significant adoption in 18 metro areas including Boston, Chicago, New York, Washington, D.C., San Diego, and Los Angeles. San Francisco usage has earned the site over 4000 reviewed restaurant listings, some with hundreds of reviews each. The site boasts of having over 2.3 million reviews overall as of February 2008. Reviews trend 85% positive as estimated by the CEO and are thought to come primarily from the 26-35yo demographic
.
- and JSON
-based application programming interface (API) in August 2007. The API provides access to business listing details, reviews, photos, and ratings and can be used to add business information to a website, widget, or mobile application. The API has been used to integrate business reviews into existing Google Maps applications such as on Zillow.com
.
. Changes to the site privacy policy
were made to accommodate this feature, which experienced negative press at the time.
Yelp has taken measures to prevent false check-ins by service users at their advertising clients' business locations.
published a 2009 story highlighting businesses that said that Yelp salespeople offered "to hide negative customer reviews of their businesses" by paying for advertising sponsorship contracts. The story claims that positive reviews appeared to be removed when the business declined to become an advertiser, a practice Yelp denies.
s have been filed by business owners against reviewers. On November 3, 2009, a Yelp user was confronted by the owner of a bookstore in San Francisco at his home. The user had posted a review criticizing the store and received a string of angry messages towards him, which he revealed through screenshot
s. The user called the police, who arrested the bookstore owner, and obtained a restraining order.
In February, 2010, two law firms filed a class action lawsuit accusing Yelp of "extortion" on behalf of a veterinary hospital in Long Beach, California
that made similar claims. Partially in response to these allegations and in a move to increase transparency, Yelp now shows which reviews get filtered by its filtering algorithm.
Another form of illegitimate review concerns people who have never visited an establishment. In July 2010, American chef Graham Elliot
's sandwich shop Grahamwich had already received a negative one-star-review from a user complaining that the not-yet-opened restaurant had ruined his "pleasant walk". Elliot commented that this made him "question the legitimacy of the reviews involving businesses that are in actual operation." Elliot also said he had been "kicked off Yelp three times for responding to reviews that were just plain factually wrong."
Social network service
A social networking service is an online service, platform, or site that focuses on building and reflecting of social networks or social relations among people, who, for example, share interests and/or activities. A social network service consists of a representation of each user , his/her social...
, user review
Review site
A review site is a website on which reviews can be posted about people, businesses, products, or services. These sites may use Web 2.0 techniques to gather reviews from site users or may employ professional writers to author reviews on the topic of concern for the site...
, and local search
Local search (Internet)
Local search is the use of specialized Internet search engines that allow users to submit geographically constrained searches against a structured database of local business listings...
web site. Yelp.com has more than 54 million monthly unique visitors as of late 2010.
History
Yelp was one of three projects, including Adzaar and Slide, to come out of the San Francisco incubator, MRL Ventures. The project arose out of research into the local services market by David Galbraith, who worked with Jeremy Stoppelman on the early stages of the project. Stoppelman and Russel SimmonsRussel Simmons
Russel Simmons is a co-founder of Yelp, Inc..He was previously an early employee of PayPal.- References :...
, both of whom were early software engineering
Software engineering
Software Engineering is the application of a systematic, disciplined, quantifiable approach to the development, operation, and maintenance of software, and the study of these approaches; that is, the application of engineering to software...
employees at PayPal
PayPal
PayPal is an American-based global e-commerce business allowing payments and money transfers to be made through the Internet. Online money transfers serve as electronic alternatives to paying with traditional paper methods, such as checks and money orders....
, spun the service off as a separate company. After an aborted start as an email recommendation service, Yelp launched its namesake web site into the San Francisco market in October 2004. The company received $6 million in early funding from venture capital
Venture capital
Venture capital is financial capital provided to early-stage, high-potential, high risk, growth startup companies. The venture capital fund makes money by owning equity in the companies it invests in, which usually have a novel technology or business model in high technology industries, such as...
firms Mission Street, led by another former Paypal-er Max Levchin
Max Levchin
Max Rafael Levchin is a Ukrainian-born American computer scientist and internet entrepreneur widely known as one of the co-founders and for his role as the former chief technology officer of PayPal....
, and Bessemer Venture Partners
Bessemer Venture Partners
Bessemer Venture Partners is a private venture capital firm with offices in Silicon Valley, New York, Massachusetts, Israel, China, and India.Bessemer Venture Partners is the longest-standing venture capital practice in the United States...
. Additional investments were made by Benchmark Capital
Benchmark Capital
Benchmark Capital is a venture capital firm responsible for the early stage funding of some very successful startups. In 1997, the firm invested $6.7 million in eBay, which became worth more than $5 billion by the spring of 1999. Other high-profile investments include Ariba, Juniper Networks, Red...
, DAG Ventures
DAG Ventures
DAG Ventures is an American venture capital firm based in Palo Alto, California. It is known as a "coattail" fund for co-investing in later-stage private financing rounds alongside more prominent top-tier venture funds such as Kleiner Perkins, Sequoia Capital, Benchmark Capital, and Accel Venture...
, and a private Investor from Laguna Beach, who invested $3 million, $3 million, and $5 million respectively. Yelp expanded from its San Francisco roots to open an east coast office in Manhattan
Manhattan
Manhattan is the oldest and the most densely populated of the five boroughs of New York City. Located primarily on the island of Manhattan at the mouth of the Hudson River, the boundaries of the borough are identical to those of New York County, an original county of the state of New York...
in the first half of 2008 and by introducing a Canadian-focused version of the site in 2008. Yelp now has international sites in Spain, France, Germany, Austria, the United Kingdom and the Netherlands. As of 2008, Yelp's page view
Page view
A page view or page impression is a request to load a single HTML file of an Internet site. On the World Wide Web a 'page' request would result from a web surfer clicking on a link on another 'page' pointing to the 'page' in question. This should be contrasted with a hit, which refers to a...
count overtook its predecessor and early rival, Citysearch
Citysearch
Citysearch is an online city guide that provides information about businesses in the categories of dining, entertainment, retail, travel, and professional services in cities throughout the United States. Visitors to each of Citysearch's local city guides will find contact information, maps, driving...
. Revenues were approximately US$30 million for 2009, with $50 million to be expected in 2010.
On December 17, 2009, TechCrunch
TechCrunch
TechCrunch is a web publication that offers technology news and analysis, as well as profiling of startup companies, products, and websites. It was founded by Michael Arrington in 2005, and was first published on June 11, 2005....
reported that Yelp was in advanced negotiations with Google
Google
Google Inc. is an American multinational public corporation invested in Internet search, cloud computing, and advertising technologies. Google hosts and develops a number of Internet-based services and products, and generates profit primarily from advertising through its AdWords program...
to buy the company for more than $500 million. By December 21, the same source was reporting that Yelp's CEO had rejected the Google offer.
Yelp has been identified as a possible candidate for an IPO
Initial public offering
An initial public offering or stock market launch, is the first sale of stock by a private company to the public. It can be used by either small or large companies to raise expansion capital and become publicly traded enterprises...
by 2013.
In November 2011, Yelp filed with the SEC to raise up to $100 million in an initial public offering.
The site currently has more than 61 million monthly unique visitors across 13 countries.
Local search
Yelp provides online local search capabilities for its visitors. A typical search includes what the user is seeking (e.g. a barber shop) and the location from which the search is to be performed, entered as a specific address, neighborhood, city/state combination, or zip code. Each business listing result contains a 5-point rating, reviews from other site visitors, and details such as the business address, hours, accessibility, and parking. Site visitors can aid in keeping the business listings up to date, with moderator approval, and business owners can directly update their own business' listing information.Listings and related content are organized by city and a multi-tier categorization system. Content and listings can also be discovered through categorized reviews or via Yelp member profiles and their review lists. Maps leveraging Google Maps
Google Maps
Google Maps is a web mapping service application and technology provided by Google, free , that powers many map-based services, including the Google Maps website, Google Ride Finder, Google Transit, and maps embedded on third-party websites via the Google Maps API...
show reviewed businesses to further aid in business discovery.
Information can be accessed by web or mobile browsers.
Community
Yelp combines local reviews and social networkSocial network
A social network is a social structure made up of individuals called "nodes", which are tied by one or more specific types of interdependency, such as friendship, kinship, common interest, financial exchange, dislike, sexual relationships, or relationships of beliefs, knowledge or prestige.Social...
ing functionality to create a local online community
Virtual community
A virtual community is a social network of individuals who interact through specific media, potentially crossing geographical and political boundaries in order to pursue mutual interests or goals...
. Adding social web
Social Web
The social Web is a set of social relations that link people through the World Wide Web. The Social web encompasses how websites and software are designed and developed in order to support and foster social interaction. These online social interactions form the basis of much online activity...
functionality to user reviews creates a reputation system
Reputation system
A reputation system computes and publishes reputation scores for a set of objects within a community or domain, based on a collection of opinions that other entities hold about the objects...
, whereby site visitors can see which contributing users are the most popular, respected, and prolific, how long each has been a member, and which have interests similar to theirs. Peer feedback mechanisms, and placement of popular reviews on the site and in local market Yelp newsletters help motivate contributors. Yelp also has a "First to Review" reward system to create a competition among contributing members, further motivating the creation of reviews and adding to the site's business coverage.
The company strengthens the online community through off-line events at nightclub
Nightclub
A nightclub is an entertainment venue which usually operates late into the night...
s, bars, restaurants, and cultural venues in various cities for its most prolific and loyal contributors, named "Elite" members on the site. These members must provide a photo and their real name, be at least of legal drinking age, and not own a local business. In return these members receive a special badge on their personalized page for every year they author a specific number of reviews or contribute to the improvement of the online community. The concept is meant to indicate that the user is a trusted author of business reviews. To gain Elite status, it is often helpful to be nominated by other Elite users but recognition is bestowed when one writes useful, funny or cool reviews so members can vote on those reviews.
The site also has a forum
Internet forum
An Internet forum, or message board, is an online discussion site where people can hold conversations in the form of posted messages. They differ from chat rooms in that messages are at least temporarily archived...
for online socialization and to discuss local businesses and events.
A number of competitors emulating these Yelp concepts have failed or were acquired.
Content
The Yelp sites have listings for businesses throughout the United States and Canada and accept reviews of any business or service. Listings vary widely in nature with the site including listings for storefronts such as restaurants and shops; service businesses such as doctorsPhysician
A physician is a health care provider who practices the profession of medicine, which is concerned with promoting, maintaining or restoring human health through the study, diagnosis, and treatment of disease, injury and other physical and mental impairments...
, hotels, and cultural venues; and non-business locations such as schools, museums, parks, and churches.
San Francisco, the home city, remains the most active as of 2008, with significant adoption in 18 metro areas including Boston, Chicago, New York, Washington, D.C., San Diego, and Los Angeles. San Francisco usage has earned the site over 4000 reviewed restaurant listings, some with hundreds of reviews each. The site boasts of having over 2.3 million reviews overall as of February 2008. Reviews trend 85% positive as estimated by the CEO and are thought to come primarily from the 26-35yo demographic
Demographics
Demographics are the most recent statistical characteristics of a population. These types of data are used widely in sociology , public policy, and marketing. Commonly examined demographics include gender, race, age, disabilities, mobility, home ownership, employment status, and even location...
.
API
Yelp released a free RESTRest
Rest may refer to:* Leisure* Human relaxation* SleepRest may also refer to:* Rest , a pause in a piece of music* Rest , the relation between two observers* Rest , a 2008 album by Gregor Samsa...
- and JSON
JSON
JSON , or JavaScript Object Notation, is a lightweight text-based open standard designed for human-readable data interchange. It is derived from the JavaScript scripting language for representing simple data structures and associative arrays, called objects...
-based application programming interface (API) in August 2007. The API provides access to business listing details, reviews, photos, and ratings and can be used to add business information to a website, widget, or mobile application. The API has been used to integrate business reviews into existing Google Maps applications such as on Zillow.com
Zillow.com
Zillow is an online real estate database that was founded in 2005 by Rich Barton and Lloyd Frink, former Microsoft executives and founders of Microsoft spin-off Expedia. The website uses a proprietary algorithm called the "Zestimate" to appraise property values based on undisclosed factors...
.
Facebook Beacon integration
In December 2007 Yelp implemented Facebook BeaconFacebook Beacon
Beacon was a part of Facebook's advertisement system that sent data from external websites to Facebook, for the purpose of allowing targeted advertisements and allowing users to share their activities with their friends. Certain activities on partner sites were published to a user's News Feed....
. Changes to the site privacy policy
Privacy policy
Privacy policy is a statement or a legal document that discloses some or all of the ways a party gathers, uses, discloses and manages a customer or client's data...
were made to accommodate this feature, which experienced negative press at the time.
Advertising program
Businesses may advertise with Yelp for preferred search result placement and extra listing features. For the advertising fee, the business may include an individualized message, video and photo slide show onto the web page for its listing as well as receive reports on listing traffic.Yelp has taken measures to prevent false check-ins by service users at their advertising clients' business locations.
Criticism of reviews
Yelp has been criticized over the fairness of negative reviews on the site. A competitor can easily write an anonymous, negative review. Yelp states that it will not censor reviews, but will remove suspicious reviews. The Oakland, California based East Bay ExpressEast Bay Express
The East Bay Express is an Oakland-based weekly newspaper serving the Berkeley, Oakland, and East Bay region of the San Francisco Bay Area...
published a 2009 story highlighting businesses that said that Yelp salespeople offered "to hide negative customer reviews of their businesses" by paying for advertising sponsorship contracts. The story claims that positive reviews appeared to be removed when the business declined to become an advertiser, a practice Yelp denies.
Incidents
Several lawsuitLawsuit
A lawsuit or "suit in law" is a civil action brought in a court of law in which a plaintiff, a party who claims to have incurred loss as a result of a defendant's actions, demands a legal or equitable remedy. The defendant is required to respond to the plaintiff's complaint...
s have been filed by business owners against reviewers. On November 3, 2009, a Yelp user was confronted by the owner of a bookstore in San Francisco at his home. The user had posted a review criticizing the store and received a string of angry messages towards him, which he revealed through screenshot
Screenshot
A screenshot , screen capture , screen dump, screengrab , or print screen is an image taken by a computer to record the visible items displayed on the monitor, television, or another visual output device...
s. The user called the police, who arrested the bookstore owner, and obtained a restraining order.
In February, 2010, two law firms filed a class action lawsuit accusing Yelp of "extortion" on behalf of a veterinary hospital in Long Beach, California
Long Beach, California
Long Beach is a city situated in Los Angeles County in Southern California, on the Pacific coast of the United States. The city is the 36th-largest city in the nation and the seventh-largest in California. As of 2010, its population was 462,257...
that made similar claims. Partially in response to these allegations and in a move to increase transparency, Yelp now shows which reviews get filtered by its filtering algorithm.
Another form of illegitimate review concerns people who have never visited an establishment. In July 2010, American chef Graham Elliot
Graham Elliot
Graham Elliot Bowles , known professionally as Graham Elliot, is a Chicago, Illinois-based chef.-Personal life:Elliot was born in Seattle, Washington, as a self-described "Navy brat". He dropped out of high school at the age of 16 and started out in the food business as a dishwasher and bus boy for...
's sandwich shop Grahamwich had already received a negative one-star-review from a user complaining that the not-yet-opened restaurant had ruined his "pleasant walk". Elliot commented that this made him "question the legitimacy of the reviews involving businesses that are in actual operation." Elliot also said he had been "kicked off Yelp three times for responding to reviews that were just plain factually wrong."
External links
- yelp.com - official US site