New York — In its quest to expand beyond US and grab a bigger slice of the European pie, the online review and recommendation service Yelp announced today that it has acquired its European rival Qype for $50 million, accelerating its international expansion with increased focus on Germany, the United Kingdom, France, Switzerland, Austria, Ireland, Poland, Spain and Italy.
Apart from facing threat from Google’s own local listings, Yelp is beefing up through acquisition on its internationalization tilt, which is evident from the news today that the company is buying Qype, its largest European counterpart, for $50 million.
The company, whose mission is to “connect consumers with great local businesses,” said today that it has acquired Qype. Originally commenced operations in Germany before expanding into many European cities, Qype dubs itself Europe’s biggest local reviews site.
Established in 2006, like Yelp, Qype’s livelihood is in listings for countries like the United Kingdom and Germany, where it has had a much greater influence and marketshare than Yelp. It offers a dedicated iPhone app for customers to find and visit local businesses.
Image Credit: (Yelp)
Commenting on the acquisition, Yelp CEO Jeremy Stoppelman said, “I am thrilled to welcome Qype’s employees and users to Yelp. We have built a solid foundation in Europe and this acquisition should significantly increase our international presence. With its strong local content in key markets like Germany and the United Kingdom, we believe that Qype will help Yelp become the de facto choice for local search in those markets. Qype’s established European sales force will also bring more local business owners into the Yelp ecosystem, which in turn will bolster our mission to connect people with great local businesses all over the world.”
Europe has been a significant point of focus recently for Yelp, which launched in Poland two weeks ago and in countries like Finland, Norway, and Denmark earlier this year. Now, with this acquisition, it is fairly evident that Yelp is really going for dominance in Europe.
This marks another European exit to a larger US category rival. But it is not one of the largest in money terms. Formed by German entrepreneur Stephan Uhrenbacher, Hamburg, Germany-based Qype was loaded with $23.1 million in investment from Advent, Partech, Wellington and others, according to CrunchBase – a string of European Vcs.
The outfit’s strength has always been its international breadth, operating in Germany, the United Kingdom, France, Switzerland, Austria, Ireland, Poland, Spain, Italy and Brazil.
Typically, both sites help people find local restaurants, gas stations, hospitals, retail stores, and a variety of other businesses. Users can find details on a business, including the address, directions, and phone number. And they can read reviews from fellow members to see if the business is worth trying.
Under the terms of the deal, Yelp acquired all of Qype’s shares for around $24 million in cash and 970,000 of its own Class A stock — a total price tag of around $50 million. The ethos behind spending that much money is to help Yelp further branch out across Europe.