The $500 million website Yelp grows on the strength—and grumpy volume—of its Elite food critics
Outside the Project One gallery in San Francisco's design district, a young woman dressed as an ice cream sundae is standing beside the velvet rope. Inside, a throng of young professionals binge on free wine and brownies as they're feted by a man dressed as a cupcake and another as a gingerbread cookie. This so-called Sugar High soiree is not a child's birthday party. It's an exclusive event honoring one of the foodie world's most influential sects: the Yelp Elite Squad, the search website's cognoscenti.
In the strange, exclamation point-laden netherworld of online restaurant reviewing, the Elite are a chosen people. They're selected each year through a clandestine Skull and Bones-like process that evaluates the quality and extraordinary quantity of their Yelp.com review writing and their popularity among the San Francisco-based company's millions of users who rely on the site's recommendations to pick, among other things, a lunch spot, after-work bar, or client dinner joint. Adding to its aura, Elite status is proffered by a governing body known as The Council, which is also shrouded in mystery. Says Andrea Rubin, Yelp's vice-president of North American marketing: "We don't share how it's done."
Yelp also refuses to divulge the total number of Elites worldwide, but industry estimates put the figure in the low thousands. It's a motley crew of tastemakers from St. Louis to Lyon—students in their twenties, marketers in their thirties, housewives in their forties, engineers in their fifties, venture capitalists in their sixties, and one 89-year-old great-grandmother living in Los Angeles. Together, this restaurant-reviewing mafia has the power to build up businesses—and take them down. "It's a huge force to reckon with," says Brandon Arnovick, the owner of Mission Minis, a San Francisco cupcakery. "These people are beyond just hobbyists." Says industry analyst Jeremiah Owyang of the Altimeter Group, a San Francisco market research firm: "They're the new Zagats."
The Elite tribe was founded in 2005, a year after Yelp's inception, to gain influence over the restaurant business and encourage user-generated content. Yelp co-founder Jeremy Stoppelman and then-brand manager Nish Nadaraja wanted to reward the site's most prolific reviewers and spur them to continue to draw traffic—without, of course, actually paying them. So they granted these voracious users "elite" badges on their profiles and access to parties—most of which, of course, Yelp got someone else to pay for.
Events, now held monthly, are generally underwritten by local businesses hoping to market themselves to the Elite. They range from winery tours to 4,000-person Yelpapaloozas (coming this summer to the Bay Area) to goofy parties where people dress up like cupcakes. "It's counterintuitive for an Internet business to bring people together offline," says Greg Sterling, a San Francisco-based Internet analyst. "Bringing these people together in the physical world was smart, because it strengthened the community." And it's worked like a charm—albeit for a certain personality type. "The primary perk is getting to go to the parties," says Becca Shansky, a retired member of the New York group. "Free booze and food, plus you get to see all your friends and geek out about restaurants. It's an incentive to stay involved, as we're obviously generating content for Yelp at no charge."
This free-labor mind trick has helped bolster the company's geographical expansion—its key source of revenue growth—as it attracts new users and adds to the number of restaurants reviewed. In the past two years, Elite Squads have been launched in Paris, Toronto, London, and Vienna, and in less renowned culinary capitals such as Pittsburgh, Calgary, and Leeds. In all, there are more than 60 Elite Squads throughout North America and Europe. "The nucleus of Yelp is that community," says Nadaraja, who is no longer with the company but retains a share of equity. "Anything coming in—advertising, sponsors, etc.—is all based on that." Silicon Valley firm NeXtup Research recently valued Yelp at more than $500 million.
For the Elite, the rewards of composing daily, adjective-rich, multihundred-word-long restaurant reviews are much less clear. While some have tried to use their status as a platform for greater foodie glory, few have succeeded. Ed Uyeshima leveraged his membership into a travel writing gig at the San Francisco Examiner; New York Elite Chris Hansen parlayed his cult popularity into work at the somewhat influential midtown Manhattan lunch website midtownlunch.com. Last fall power reviewer Libby Rego earned a guest spot on Gordon Ramsey's reality show, Hell's Kitchen. And those are the success stories.
For others, the rewards are personal. San Francisco architect and amateur pickled meats expert Theodore Ordon-Yausi, 26, was tapped in 2010 after attending the "Elite Prom" as a plus-one. "My reviews are definitely read more now," says Ordon-Yaussi, who writes under the nom de plume The King of Pastrami. "I get more random messages from people I don't know. I have 20 new fans who follow my reviews." That can be invigorating. "I like to tell my friends that my opinion is important," says 29-year-old research scientist Kristin Patrick. "When I go into a restaurant, the owner says, 'You're here to write a review, aren't you?' I'll say, 'Don't worry, I'm Elite.'"
Yet with clout can come hubris. A recent fracas among Elite users in Los Angeles and Vancouver resulted in several account deletions. Houston Elite member Edgar V maintains a Web page of businesses he feels are "Evil and Must be Destroyed." And while this includes massive corporations such as Bank of America (BAC), it also lists Van's Chinese Seafood Restaurant in San Antonio—on whose Yelp page Edgar V's scathing review is listed first. And then there are persistent entitlement issues. This spring, Yelp's New York community manager sent a letter to Elites after a party at Club A Steakhouse turned into "abject terror." One waiter at the restaurant, the letter said, "was absolutely traumatized by the rabid ferocity with which certain guests attacked his plate of hors d'oeuvres." It wasn't the first time. "The staff at several events," read the dispatch, "has commented on the fact that occasionally some members of the Elite Squad at meals can be likened to an Animal Planet feeding frenzy."
The Elite Squad's greatest threat may be itself. As Yelp continues to develop its haut monde, Elites face a future in which their cult influence is being betrayed by their growing numbers. With Yelp pushing mobile device searches, which account for one-third of all searches on the site, the utility of the hyperbole-rich essays is also declining. For some, it's the end of an era—and time to get a more productive hobby. "On a personal level, I got what I needed out of it and moved on," says Christie Day-Gee, a Chicago real estate broker who relinquished her badge last year. Retired engineer Phil Anderson, a member of the 2005 inaugural class, agrees. "I still write reviews," he says, snapping a picture of some osso bucco at San Francisco's South Harbor Restaurant and uploading it for a future review. "Instead of a review a day, I do one a week." But Anderson, who also gave up the badge, is O.K. with that—at least sort of. "Life evolves," he says, "and you move on—to some degree."