|Yelp Shares Surge In Early Trading|
Yelp Shares Surge In Early Trading [news.cnet.com]
In its IPO on the Nasdaq, the local-reviews site starts the day at $15 a share, but quickly jumps much higher.
If there was any doubt about Yelp's IPO pricing, it should be laid to rest right now.
The local-reviews site kicked off its IPO at $15 a share today on the Nasdaq, but soon after trading began, the stock jumped 73 percent to $26. After hitting the high mark, the shares cooled off a bit, but as of this writing are still moving along at around $24.62.
Never used Yelp, don't know much about it.
|Never used Yelp, don't know much about it. |
Totally unethical company when they started out. They would seed the site with bad reviews and then "blackmail" company owners to pay for a premium account which would allow them to remove the negative reviews.
After initially claiming this was not true, they back-paddled and said they did in fact hire "reviewers" to seed the sites, and that some rogue sales people would pitch companies on the concept of paying and removing negatives -- but claimed this was not company policy.
Like Facebook, I am wary of any company that starts off on an unethical bad foot. If the original management is still in place, so are their ethics.
I have not been on Yelp in several years. I consider their reviews worthless, (a combination of constant complainers, paid promoters and SEO types, and friends and employees of company's who artificially pump in good reviews).
It looks like were back in pre-bubble burst IPO days for web based tech stocks.
...ok, while I was writing this I decided to look the site over -- give them a fair chance.
"Two Thumbs Down" is my rating. The reviews are a mix of "negative" real people's complaints, and obvious paid and friends of business' reviewers, (How can I tell you ask?)... The negatives will give 1 to 2 stars, and usually be people with 5, 10 or more reviews under their belt. The positives will give 5 stars, and either have 1-2 reviews they've posted (friends and employees asked to post a positive review), or 200-300 reviews -- these are the paid reviewers, (or "online reputation management professionals" as they call themselves) -- the paid reviewers also use very SEO-centric wording, type in full sentences, or mention the full name of a sales person in the case of insurance, car, and other commissioned sales where the business has many.
I'd like to hear what Yelp plans to invest the investors money into -- as I see it they have not innovated in years -- just added more paid advertising.
My IPO thoughts are "jump in and out quick if you're going to play"... long term doesn't look good to me.
and if you look around further, you'll find many more companies in the internet sector who started out unethically (youtube comes to my mind - allegedly, to gain traffic in the first place, the founders and early management started with uploading copyrighted, highly demanded material on their own).
in fact, most (more or less successful) web startups have a certain pattern in common: the opt-out principle: unsolicitedly including other peoples' material and information thereof in their databases. legal or not, that is another question.
and yes, even googles' success is based on this principle. imagine a legislation where people had to opt-in before you can make use of their work (like in any other commercial sector btw). what would have happened, if google had have to ask webmasters to index their websites? instead of demanding from the creatives to "take adequate precautions" to signalize their disagreement with practices like that. right, a non-starter - many of those internet firms had to pack up and go home.
that is the shaky foundation most of the web business is based on.
|and if you look around further, you'll find many more companies in the internet sector who started out unethically |
It goes back before the net. Back in BBS days, Jim Maxey of Event Horizon BBS used to scan Playboy and Penthouse images and charge people by the hour for access to his BBS --- he reportedly grossed several million dollars (when most of us "sysops" could barely scrape a living out of dial-up systems).
When he finally got sued for copyright infringement on the Playboy stuff, Maxey gladly paid a 1/2 million to settle, (he wrote them a check and said "thanks") --- then he used his considerable wealth to hire his own models and continued on in the same business. (He asked me to work for him "back in the day" and I refused because I don't do "adult" -- if it weren't for ethics, I'd be rich... What's that saying, about camels and the eye of a needle?).
NOTE: Maxey started out legit -- he used to grab NASA space photos and have people download them. Skin sells better than stars.