Online review site Yelp has just been valued at $3.5 billion. With that knowledge, the company is apparently exploring the exhilarating world of potential sales. As the Wall Street Journal points out, there are plenty of reasons why a company with enough cash would be interested in acquiring Yelp: "A deep base of reviews can be a valuable asset because they take time to amass. Reviews are magnets for smartphone users, valuable for companies seeking mobile growth. Also, a website with a loyal following entices more users to visit the site directly, allowing its owner to avoid paying for search engine advertising." In other words, despite the fact that its own revenue comes from the comparatively small local ad market, Yelp’s 10-year-old, comprehensive business list and review archive is a hot commodity.
Yelp has not confirmed it’s actually for sale: It’s possible that after some public relations snafus — including multiple lawsuits and trips to court over the past few years — perhaps the company is just looking for some positive attention. (It's working; Yelp's stock surged after news of the potential sale broke.) But should Yelp legitimately be on the market, here's a look at the four companies who seem the most likely candidates for a potential buy:
Enterprise Value: $207.18 billion
Estimated Available Cash: $4.42 billion
Why Facebook Would Want Yelp: Facebook is huge and wants to be a part of every aspect of your life (this is argument Number One as to why Facebook would buy literally any popular web-based company). But there are other reasons Facebook make a play for Yelp. Facebook has been trying hard to make check-ins and reviews happen, a space where the latter dominates. Facebook has also been dabbling in the restaurant world, adding menus to restaurant pages and exploring mobile reservations, and owning Yelp would make entry in that sphere far more achievable. But above all else, Yelp is a user-generated content superforce and so, in its way, is Facebook.
Enterprise Value: $200.25 billion
Estimated Available Cash: $3.86 billion
Why They'd Want Yelp: The online shopping powerhouse has recently dabbled in everything from original content (in its Amazon Prime television shows and in-house publishing of late) to food delivery services in the vein of Seamless and Grubhub. But crucially, last fall, the site announced the launch of a direct Yelp and Angie’s List competitor called Amazon Services, which allows users to hire in-person services — like repair people — directly through Amazon. Amazon Services currently integrates both Yelp reviews and Amazon’s own reviews on business pages, but a Yelp acquisition would give Amazon access to its valuable database of both reviews and verified businesses — the Wall Street Journal noted last year that it "can take years to build a stable of service providers." Why wouldn't Amazon CEO — whose own personal net worth is $38.7 billion, aka the equivalent of 10 Yelps — pony up the cash to make that all happen faster?
Enterprise Value: $65.21 billion
Estimated Available Cash: $2.06 billion
Why Priceline Would Want Yelp: After last year's $2.6 billion acquisition of reservation behemoth OpenTable, Priceline has a few reasons to be interested in Yelp. Yelp's deep bench of reviews and users might appeal for Priceline, which also owns companies like Booking.com and Kayak.com. Yelp also operates its own reservation service, SeatMe, which is a direct competitor of OpenTable's. OpenTable has long been in the habit of acquiring potential competitors, as has its parent company Priceline. Buying and integrating Yelp into the fold could make sense.
Enterprise Value: $313.02 billion
Estimated Available Cash: $8.53 billion
Why Google Would Want Yelp: They probably don’t. Back in 2011, Google acquired restaurant review/listing site Zagat for $125 million, and though the acquisition has enjoyed just limited success by all accounts, Zagat did provide two of Yelp’s most valuable assets: reviews and the restaurant listing database. Two years before buying Zagat, Google supposedly offered Yelp $500 million to acquire that company. Why the deal never happened depends on who you ask, but Google and Yelp have had a tumultuous relationship ever since. Yelp has accused Google of manipulating its search results to favor its own content, going so far as to run deceptive ads for Zagat even for search queries where users explicitly searched for "Yelp."