JEREMY STOPPELMAN: THE CO-FOUNDER AND CEO OF YELP

Jeremy Stoppelman is an American business executive who is known as the co-founder and CEO of Yelp, a local-search service powered by a crowd-sourced review forum.

By Balthazar Malevolent

JEREMY STOPPELMAN: THE CO-FOUNDER AND CEO OF YELP

Jeremy Stoppelman, who was born on November 10, 1977, in Arlington, Virginia, is an American business executive. He is the Yelp’s CEO, which he co-founded in 2004. His father, John, was a securities lawyer, and his mother, Lynn, was an English teacher. As a kid, Jeremy had an interest in computers and business and started investing in stocks at the age of 14.

Jeremy Stoppelman desired to become a video game developer and took computer programming classes, where he learned Turbo Pascal software programming system. He attended at the University of Illinois at Urbana-Champaign and attained a Bachelor’s Degree in Computer Engineering in 1999. He acquired a job with @Home Network after he graduated as a software engineer. He implemented and designed various website features using the Netscape Livewire for @Home’s provisioning system and proprietary billing.

Jeremy Stoppelman acquired a spot at X.com after four months of working for @Home Network as an engineer, which later on retitled to PayPal. It was then that Jeremy met Max Levchin, an entrepreneur who later became a stockholder to his company, Yelp Inc. Jeremy became the Vice President of engineering and is also one of a group of PayPal’s early employees, which referred to as the PayPal Mafia.

Jeremy managed a team with 43 persons (6 managers and 37 engineers) that were responsible for software development at PayPal. He left Paypal after the acquisition by eBay in 2003 and attended Harvard Business School for one year. During his school break, Max Levchin encouraged Jeremy to do an internship at the business incubator, MRL Ventures.

Yelp

In the summer of 2004, Jeremy got flu and had difficulty finding recommendations for a local doctor. He and Russel Simmons, a former PayPal colleague, began brainstorming on how to create an online community where users could share recommendations for local services. Both men pitched the idea to Levchin who provided initial funding of $1 million. Under Jeremy’s leadership, Yelp grew to a market capitalization of $4 billion and hosted 138 million user reviews.

Steve Jobs called Jeremy in an effort in persuading him to turn down an acquisition offer by Google and in March 2012, Jeremy rang the bell for the New York Stock Exchange after his company went public. According to Jeremy, the biggest challenge that the Yelp has encountered is the same problem Google faces in its rankings. Business holders had used those commentators that leave undesirable reviews and raising accusations that Yelp fiddles with reviews to favor companies that advertise, leading to legal troubles for the company. In February of 2013, Jeremy accepted a salary of $1, though he continued to earn income from his investment of 11% interest in the company.

His Struggles

Google was supportive at first with the company. Yelp even signed a partnership arrangement in 2005 with the company to allow access to some of the Yelp’s reviews. Jeremy Stoppelman has accused Google of stealing Yelp’s review content, altering systems so competitors sink lower in search results, and creating a network of politicians to protect its dominance, but Google denies the accusations.

Yelp compiles the reviews of local services, from plumbers to doctors and restaurants to nail salons. The company makes revenue by selling advertising to these businesses. It is on track to generate almost $1 billion in revenue last year. But compared to Google, it was tiny: traded on the New York Stock Exchange, it has a market capitalization of $3.7 billion, making it less than half of 1% of the size of Google.

In 2016, the San Francisco-based company pulled out of Europe after losing a battle with Google. Yelp financed tens of millions of dollars, but it abandoned the venture, lay-off 175 employees. Yet, Jeremy Stoppelman refused to give up. The company pressed a new complaint with Europe’s anti-trust watchdog, arguing the search company abused its dominance and pressuring Brussels to bring new charges against Google.

Last year, Jeremy Stoppelman tried to recruit the other members of Silicon Valley to his cause. He tried to convince start-up founders to speak out, but many were reluctant. As Yelp’s CEO, he had to first convince his investors to let go of the Google partnership in 2007, which was bringing in 5% of traffic.

Recently, Yelp has hired Evercore to help preserve the company against an activist investor, who recently called for a board shake-up and potential sale. Yelp co-founder and CEO, Jeremy Stoppelman and the board have now selected Evercore to work with the company and survey the market, but the bank hasn’t started running a sales process. At the current market evaluation of over $3 billion, there are few, if any, credible buyers.

Yelp has struggled to defend off rivalry from Google, which is both the largest search engine and a rival in the review market. The company has also behind other companies that offer technology and tools to measure the efficiency of ad spend and has failed to keep up with Google’s local discovery features.

In the past years, Yelp has been on the M&A market. In 2015, the company hired Goldman Sachs to conduct a sales process. That effort ended when Jeremy decided not to move forward despite having numerous interested buyers. The Evercore-led process could just end up with the company looking for a buyer, but the company hasn’t made any decisions yet about selling this time.

Jeremy Stoppelman
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