Ten years ago PayPal alums Jeremy Stoppelman and Russel Simmons had an idea for a website that would allow users to review restaurants and other local businesses. The pair took $1 million in seed capital and turned it into Yelp.
“If you think about the world prior to Yelp, it was the world of the professional critic,” says Stoppelman. “And so that meant lots of businesses didn’t get any exposure at all and the ones that did had kind of a one-shot deal.”
Simmons has since left the company but Stoppelman remains CEO 10 years on. This year is significant for another reason too – in the last quarter, Yelp posted a profit for the first time.
Though it’s free for users to post reviews, Yelp makes money by selling advertisements to small businesses. That concept brought Google knocking in 2009 with an offer to buy the company. Stoppelman remembers the day Steve Jobs called, urging him not to sell. "Fortunately, we chose the independent path," Stoppelman says, "and I think the company is much more successful as a result."
As for how he and Simmons came up with the name for their now-ubiquitous company, they credit their early days at a business incubator.
“There was a guy we were working with, David, and he just came up with the name. He said it was like Help/Yelp or Yelp/Yellow Pages," Stoppelman says. "And both my and Russ’s initial response was 'Oh, that’s kind of a negative word.' But we slept on it and the next day, it was kind of history."
CORRECTION: An earlier version of this story misstated that the call from Steve Jobs to Jeremy Stoppelman was about selling. It was urging him not to sell. The text has been corrected.