Yelp bails on Google deal?

Uh-oh. Less than a week after reporting it was practically a done deal, TechCrunch has backtracked and now says that Yelp walked away from a $500 million buyout.

Maybe they read the Yelp review that says Google's headquarters is infested with skunks and raccoons.

Just a few days after reporting that Google was about 80 percent likely to be acquiring business reviews site Yelp for a totally sweet $500 million, TechCrunch has backtracked. Late Sunday, TechCrunch reported that Yelp CEO Jeremy Stoppelman personally walked away from the deal and that company representatives informed Google over the weekend they aren't selling.

Or it might have been the skunks. CC Out at Bob's/Flickr

That's odd. People seemed to think it was generally a good deal . TechCrunch isn't exactly sure what went wrong but speculates that Yelp may have gotten a better offer for a potential acquisition or strategic partnership that caused it to bail.

What could also have something to do with it: Google does a lot of things very, very well, but one thing it's never nailed is community. (Knol most certainly didn't kill Wikipedia, Orkut was big in Brazil but then faded in the wake of Facebook's growth, and YouTube's commenters seem to come from a very special place somewhere between the sixth and seventh circles of hell.) That's evident from looking at what Yelpers had to say about the potential deal last week. Proudly opinionated and devoted to the Yelp brand, many Yelpers were concerned that a Google buyout would degrade the site's sense of community--something that could, effectively, kill it.

Perhaps Yelp's execs thought the same and figured that strategic partnerships might be a better route for now.

About the author

Caroline McCarthy, a CNET News staff writer, is a downtown Manhattanite happily addicted to social-media tools and restaurant blogs. Her pre-CNET resume includes interning at an IT security firm and brewing cappuccinos.

 

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