Yelp is one of the apps I use most on my phone as it has essentially become the modern yellow pages, but it's a somewhat guilty pleasure after learning that the company's business model may be based on extortion.
If you're not familiar, back in 2009, the East Bay Express revealed that Yelp's sales reps would harass local merchants with promises to move or remove negative reviews if their business would advertise. And that hasn't changed, according to a recent Los Angeles Times story, which says Yelp "makes money by charging to downplay others' negative reviews and to keep rivals' ads away."
Of course, Yelp CEO Jeremy Stoppelman has consistently denied the accusations, saying that an advertiser can only pay to highlight a favorite review or have a clearly-labeled "sponsored result" that appears at the top of search results and a photo slideshow.
Unfortunately, but not surprising, the topic of extortion does not come up in this new Associated Press interview with Stoppelman, timed to mark Yelp's 10th anniversary.
When asked about the tech backlash in San Francisco, Stoppelman wavers between making light of the situation, in particular housing, and saying his Yelp employees are simply middle class folks just trying to get by like the rest of us (note: Stoppelman's estimated worth could be as much as $222 million).
Most cities would be falling over themselves to have the problems we have right now, which is like: "Oh my, we have too many jobs and people's compensation keeps going up, so therefore people can afford to pay more to obtain housing." It's not to say that we don't have very serious problems, but a lot of them are completely self-inflicted, which I find incredibly frustrating.
The other misperception is that everyone working in tech is a millionaire living in luxury condos and there is nothing left for anyone else. The reality is the vast majority of our employees are making anywhere from, you know, like $40,000 to $100,000. If you look at it, we are just like every other company. As rents go up, it hurts people here, too.
Then he avoids directly addressing tech's lack of diversity, blaming education instead of culture and hiring practices (also note: Yelp has yet to release its workplace diversity demographics).
If we are focusing on technology jobs, meaning software engineering jobs primarily, by the time you are talking about a company, you are talking about the end of the funnel. The funnel begins in high school, really, or even earlier maybe. If you want women and minorities to succeed all the way at the end of the funnel in a tech job, you have to increase the numbers starting at the top of the funnel, at the earliest age, and then make sure they stay in the funnel and get all the way through.
Certainly, tech companies should feel bad about it, and all the tech companies have been aware of this problem. They have been trying to address it somewhat, but there is a bit of a limitation of what you can do because fundamentally you know if women aren't entering into software engineering programs in great numbers, there's not going to be great numbers working at Google or Yelp or any tech company.
Previously: Video: Defendant Alleges Yelp Extortion On 'The People's Court'