TechCrunch is reporting that Web 2.0 local reviews service Yelp has raised $15 million in a fourth round of funding led by DAG Ventures. The rumored valuation: $200 million.
The funding would take the company, which was launched in 2004, to $31 million in total funding. According to TechCrunch, “Yelp says that they will be using the money to expand geographically, add onto their sales team, and establish a second office in New York City.”
I like local reviews services and one could probably argue that Yelp is a decent player in the space. But for a company whose “revenues are rumored to be sub $10 million/year,” $31 million in funding and a $200 million valuation do not make sense.
As reported by of ( home away from home):
Calacanis said there was a place for publishers who add real value, but told the hundreds of affiliates in attendance that too many of them were ruining the internet and causing damage with adware, malware and spam.
I recently introduced The Drama 2.0 Show to a friend, and after reading some of my posts, he asked a question: “What are you doing to monetize this?” My response: “Nothing, really. I’m taking an authentic Web 2.0 approach.”
Of course, I do have a pitch for sponsors here, but, as is probably obvious, it was written more as a joke than as a serious attempt to procure dollars. After all, I’ve always believed that the thousands of dollars sponsors (often startups) pay each month for buttons on some of the most popular Web 2.0 blogs is a complete waste of money.
Posted on February 24, 2008
Filed Under Web 2.0 Kool Aid |
I’ve always been skeptical of Facebook. Unlike many of the people who are only now pointing out that Facebook is looking, at best, significantly overvalued, I am on the record as having questioned the long-term viability of Facebook when most others were drunk on the Facebook kool aid.
In my September 16, 2006 post on the now-deceased blog Dead 2.0, I asked:
Is Facebook the new Webvan? While it’s not an apples to apples comparison, Webvan burned through $1.2 billion of investor money due to lack of cost control, was never profitable but at one point had a ridiculous market capitalization of $7.5 billion and eventually fell victim to competition and market forces. Facebook is facing the same problems: overspending, a bloated valuation and fierce competition.
Back in November, I wrote a piece that was critical of Digital Telepathy, a self-proclaimed “digital marketing agency that embodies the Web 2.0 philosophy of a democratized Internet” that was pitching entrepreneurs on its ability to deliver them with a turnkey Web 2.0 startup complete with a “truly unique business concept,” “proven user experience design” and a “completed web app.”
Some things, such as the company’s claim that when they deliver a ready-to-launch product, “there will already be a long line waiting there to catch a glimpse,” bordered on the absurd.
Redfin CEO Glenn Kelman has an interesting post that continues to prove he just might be the most sane player in the tech space these days. In “How Green Was My Valley,” Glenn discusses Seattle in the context of how it’s different from Silicon Valley.
He makes some interesting points that are well worth noting here:
In reality, most places don’t even want to try to be like the Valley.
In on the absurdity of Forrester Research’s recommendation that marketers spend more money on social media advertising, I noted:
…consumers may love your products, but at the end of the day, toothpaste is toothpaste.
I recently hired a few marketing interns and am having them catalog all of the stupid social media marketing campaigns they can find on services like Facebook. I’m thinking about one day publishing a full-color, glossy coffee table book that serves as a visual compendium of the insanity of some of the social media marketing campaigns.
Continuing my debunking of many of the absurdities promoted by social media marketers, discusses dealing with the subject of “Influentials,” those desirable individuals whose influential ways supposedly have the power to spark viral word-of-mouth buzz.
Word-of-mouth is one of the cornerstones of the social media marketer’s proposition to brands. Using social media, they’ll get your product and message into the hands of Influentials and the rest is apparently magic. Sounds good, right?
If you could gather together some of the smartest Web developers and ask them to brainstorm a killer app for you, what would you ask them to build? Oh, and they will only have 45 minutes to do it.
No, it’s not another dumb reality TV program from FOX. It’s a special panel event at the upcoming Future of Web Apps (FOWA) conference in Miami starring Web 2.0 celebrities such as Kevin Rose.
And you - the viewing public - get to play a role in what killer app they develop. That’s right, by voting on TechCrunch, you can make sure that the 45 minutes are used productively to benefit mankind.
Given my recent focus on debunking many of the claims about social media marketing and the viability of social networks as strong marketing platforms, I wanted to point readers of The Drama 2.0 Show in the direction of on the subject at E-consultancy.
In a recent free “report,” Forrester is advising clients to spend more money on social network advertising, especially as the economy falters. I think this is stupid advice and detail why .« go back — keep looking »