Being Yelped Leaves a Mark

Magazine takes a look at Yelp's relationship with small businesses and those pesky extortion rumors

Small businesses hate Yelp. At least that's what one business owner whose sanity was driven to the brink by negative comments on the San Francisco-based review site suggests, according to a new feature in Inc. magazine.

Inc., which focuses on the same small businesses Yelp reviews and courts for advertising dollars, demonstrates Yelp's conundrum. It's no longer such a small business itself, and its reputation among its potential customers keeps getting dragged through the mud.

If the company's failed negotiations with Google were not enough of an indicator that Yelp was playing in the big leagues, news that the company has $15 million in the bank and expects to be profitable by the end of the year should be.

Elevation Partners, a Silicon Valley private-equity fund backed by U2 singer Bono, is reportedly close to investing another $50 million in the company.

But Yelp shouldn't expect much sympathy from the likes of  Diane Goodman, the owner of Ocean Avenue Books, who got herself arrested for allegedly confronting a Yelper who called her store dirty.

In fact, no business owner likes Yelp, according to Goodman.

Why would they? Especially after Inc. magazine explored how the company has changed the way business owners interact with their customers and the way ads are allegedly forced on small business who would rather not be on Yelp to begin with.

One Phoenix-based restauranter described his experience with Yelp as "panning for gold in s--t." And that about sums up the love-hate relationship that small businesses have with the site that in theory could be a boon to their business.

Inc. describes small businesses' lack of control over their reviews as the core of their shaky relationship with Yelp. There is no way a business can keep itself off of the review site, short of going out of business. And even that may not guarantee anything.

Even Yelp's attempts to give some power back to the mom-and-pop shops has backfired. For as little as $300, stores are supposed to have the ability to control what review shows up on top of their Yelp page.

But some small business have complained the practice has turned into a form of extortion with Yelp salespeople insinuating that they can play down negative reviews if the companies cough up the cash. The press got so bad that Yelp CEO Jeremy Stoppelman was forced to go on a national niceness tour.

Maybe Bono can accompany Stoppelman on the next tour?

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