Slow Growth Lessons in a Hack-Assed World

The 7 Things We Learned in the Early Days of Yelp


Accelerators.

Quick Exits.

Instant Messages.

Messages that even disappear.

Everything about tech is fast. Of the moment. Almost built not to last.

Back in 2005 (George W. Bush was President), we had the opportunity to work with Jeremy Stoppelman and Russel Simmons as they began what would become Yelp. There were a lot of contributing factors to the company’s eventual success — and we get some credit for creating the brand and community aspects that helped humanize and popularize the site — but that, dear reader, didn’t happen overnight.

These days, everyone seems to have forgotten the importance of building something that actual people want and will use. Now it’s scale up, uberize, pivot and re-pivot… and if all else fails, get aqui-hired. The typical startup’s biggest press hit is about which A-List investor has dropped money into it.

It’s easier than ever to find someone to give you money but harder than ever to cut through the noise and create something important that solves a real problem. There isn’t an app that can fix this. Getting funded is not a “growth” strategy.

We are not coming down from the mountain to tell you this. In fact, post Yelp, we’ve collectively spent more time working on failed start-ups (start-downs?) than on successful ones. PayPal Mafia? More like the Yelp Half-Stars.

[BEGIN VOICEOVER]
They had no idea that this would be the ‘start’ of their careers.
They were employees #6 & 7 at Yelp, a local review site, born in an incubator.
Nish was hired to run marketing and community. Michael to emote on branding and user interface design.
In a coincidence layered in foreshadowing, they started on the same day, each unaware of the other’s existence, arriving to find the door locked and no one answering the buzzer. While staked out at a nearby coffee shop, the two bonded over pop culture, bad music and the desire to build steadfast brands.
[END VOICEOVER]

A few months ago, we were invited by Paul Willard of Subtraction Capital to give a talk to his Agile Marketing Meet-Up group.

We settled on the name ‘Slow Growth Lessons in a Hack-Assed World’, put a few pretty slides together, and to our surprise, filled up the venue. While some of our old colleagues consider us the Hall & Oates of the tech scene, something about our presentation resonated, and more than a few folks even wanted to know where they could find our ideas online.

This isn’t that presentation. But it’s 7 things we did learn from our early, pre-smartphone days at Yelp (that seem more relevant than ever before)

A venn diagram outlining the success of Yelp. Never underestimate right place, right time.

1) Don’t Build (or Settle for) Parity

In those early days, there was a huge and real concern that it was easier to find a Yelp business listing via Google (or even Yahoo) than it was to on Yelp itself. It wasn’t a question of beating Google per se, but of providing a more refined search that could uncover better and specific results from our own user-generated content than the search giant could. Try typing “gluten-free” or “martini” in each search and you’ll get an idea of the difference.

Keep in mind Yelp existed almost a year before Facebook ever came on the scene. A Connect button didn’t exist. Social graphs were a glint in data scientists’ eyes. We literally had to build a social network from scratch, replicating what MySpace and Friendster were already doing as their sole business model!

Nowadays, every app uses Facebook Connect. Every app feels social. Inviting or adding friends is not a feature, but a given. So the big question now becomes how will you do something that stands out?

2) Perpetual Benchmarking

We hear a lot of founders reference hot tech companies when they pitch i.e. We’re Uber meets Tinder, Tinder for Prisoners, Prisoners drive Ubers, etc. We think they’re in the cloud.

Actually, there are ideas, inspiration, and imagination everywhere. At Yelp, we were always looking for comparisons to what we were doing, but some of these were not obvious ones like CitySearch and Zagat.

Take the Yelp Elite Squad. This was Yelp’s super member program and it had to feel special and quirky. Private eye Dick Tracy was an early consideration, since we wanted a sense of cloak & dagger daring (years later, Yelp Elites received a watch as their annual member appreciation gift), as was American Express, where we borrowed the “Member Since” sense of prestige and loyalty.

To the Elite goes the spoils… Of swag.

The idea of perpetual benchmarking means that competition is all around, and again not in obvious and direct ways. Back in college, Nish went to a marketing lecture given by a Pepsi executive. When asked what he thought about the competitive landscape, the soda junkie didn’t start by mentioning Coke, RC, or even Faygo. He was more worried about water, coffee, tea, or not drinking at all. We took that “competition is everywhere” philosophy to Yelp when we considered that “competition” could mean people choosing not to go out, not exploring new neighborhoods, not realizing their opinion on where to eat, drink and shop, mattered.

“Isn’t that the noise a dog makes when you kick it?” — General Public on Yelp, 2005

Good design borrows from what’s already known and makes something fresh with it, and Michael did just that with the Yelp logo, the heart of the Yelp brand. Speech bubbles were tried and discarded. An attempt to own the noise a dog makes was kicked around. An abstract replacement for an exclamation mark won out, almost like an asterisk — a pop of self-expression, just like what appears over the heads of comic strip characters.

3) Your team, IRL

Makeshift tables and ramshackle collection of desks, piled on top of one another forced the issue of face-to-face interaction. Take advantage of the smallness of your company or department and interact. Make it a point to grab lunch with someone new.

Jeremy used to have weekly 1:1s with everyone on his team, and it was amazing how much would transpire in a week. It was a chance to talk and catch up, solve problems, but mainly to connect. We tended to do these meetings out of the office, oftentimes over walks, which literally and figuratively brought fresh air to perspectives and challenges.

Speaking of which, read Wanderlust by Bay Area author Rebecca Solnit; it’s a book about the range of possibilities brought on by walking. Go to a museum or library and browse and meander. We came up with the ‘Real People. Real Reviews’ tagline at the SFMoma bookstore.

If you must get somewhere quicker, take a Lyft Line and ask the other passengers questions about their life.

We’re not robots. Facial expressions and body language matter more than you think. Slack is not your friend — people are.

4) Take Little Bets

Judy’sBook and InsiderPages, two sites that were early Yelp competitors, felt like they were winning. They had 10 and 20x more reviews than us, and growing. Their secret: Paying for reviews as a way to seed content.

While our collective guts felt that this was not the way to authentically win, it was unnerving to watch, so we decided that before we completely shut out that idea, we ought to try it ourselves. After experimenting in a few cities, we quickly realized that we’d end up with thousands of mediocre reviews and very few dedicated yelpers, if any. More importantly, it just didn’t feel like the right way to grow.

That little bet opened our minds to thinking much more creatively about how to reward people for contributing reviews, and from that we arrived at the Elite Squad. The program has been copied, borrowed from, and studied, but what makes it still unique is that it works very specifically for Yelp. Over a series of iterations (there can never be an exact science when it comes to community), it has become the backbone of Yelp’s entire marketing strategy.

Note: We didn’t quite realize we were taking little bets until we had retired from Yelp, and met Peter Sims, who authored Little Bets, and told us that we exemplified a lot of the principles he covers in the book. Thanks, Pete!

Model CEO, or just plain model?

5) Authenticity at What Price?

Better than the Hair Club for Men, Jeremy Stoppelman is not only the CEO of Yelp, but a Yelp Elite member as well, 10 years and counting. He’s a real person, and he still writes reviews. Co-founder Russel Simmons is also real, but lost his Elite status years ago when he didn’t himself adhere to the guidelines for Elitehood.

There has been a lot written about Yelp’s sales practices and this isn’t the forum to discuss it, except to say that the entire program was designed on integrity and fairness. Salespeople are not allowed to write reviews of businesses, nor is any sort of review — positive or negative — able to be taken down unless it violates the Terms of Service. It’s a personal bummer when we hear someone slam Yelp’s alleged extortion practices, but then again, no one to our knowledge ever asked Yelp to take down their 5-star reviews.

The biggest signifier of authenticity is Yelp’s own listing. The detractors have left their mark in the form of one or two stars, and they’re posted for the world to see with no filter. Up close and personal is the only way to go.

6) You Can’t Growth Hack Community

Actually, we’re not even sure what growth hacking is, but it sounds like a dirty Valley word. VCs like to see growth and quantitative analysis of a product, and while there’s certainly a place for it, you can’t speed up the process. You still need to get people to genuinely want what you’ve got.

The core functionality of Yelp actually started as an ‘ask a question, get an answer’ type of product, that looked a little like a poorly responded-to Evite. The idea was to ask about, say, where to find a good burger and then email your friends, who would in turn invite their friends to answer. Network effect! It went down like a lead zeppelin. There was, however, a review component that we included almost as an afterthought… and that caught fire. We didn’t know right away but we had created a blogging platform for local reviews. After talking to some early members, we revamped the site to bring reviews to the forefront and that ‘shared reviews’ design is still at the heart of Yelp.

We thought email was the future. We thought wrong.

We get the rationale for having a minimal viable product, but why not instead go for a maximum viable one? Does Audi put out cars without parking brakes? Do you want to be Mark Duplass or Adam Sandler? Hint: Sometimes the answer is not always clear.

Whose goals are more aligned with yours?

We’re not saying ignore the numbers. In fact, Yelp was built on great SEO… but only after yelpers were writing funny, useful and cool reviews that helped people make local choices. SEO is not a magic trick; it’s a science built on relevancy. Yelp chose a slow growth path to success, one review at a time — brands that are made to last tend to avoid short cuts and quick fixes.

7) The Importance of Being a Brand

We live in an engineering world. The robots haven’t won, but it’s getting close. But the problem here is that engineers are not storytellers. This isn’t a dis, but an important reminder that you have to start with, and always go back to, the brand. The origin story. There’s no Batman without Bruce Wayne.

We run into so many founders who, for one bewildering reason or another, want to glaze over this. Maybe they have investors and metrics on their backs, but if you don’t know what you are — what you stand for — how can you expect the teeming millions to? Your brand overlies everything and informs your next product feature, your social strategy, how you hire, what sort of customers to seek out… everything.

Almost as importantly, you have to know what your brand is NOT. Focus keeps your eye on the prize, and also gives your customers a simple and clean way to care. When a yelper begged us to let her write reviews about all the books she was reading, we had to remind her that there was this little site called Amazon. Some of our early and best members also had a habit of reviewing their pets, again a cute notion but ultimately one that would cloud the effectiveness of Yelp (the solution here turned out to be basic: Take those pet reviews out of search and over time, the lack of attention curbed their enthusiasm).

Being a brand is a connection to being human. It’s so much more than a catchy slogan or smart logo. Great design helps, but if you’re not thinking about your company from a societal, psychological, and anthropomorphic perspective, then we probably won’t be talking about your great idea in five years.

“Hi. I was wondering if I could get a table for two at 8 p.m?”

Epilogue

Between the inception and the writing of this post, Yelp has been on a roller coaster of a ride, at least as far as the stock market is concerned. It’s times like this when Yelp should be looking back at what made it great in the first place. The medium might change, how we consume content might feel very different in the future, but returning to the fundamentals is always the best place to start.

Written with Nish Nadaraja