Analyzing Yelp's Eat24 Divestiture and Its Exit From Food Ordering

Yelp bought the online food-ordering service Eat24 and later sold it. Why do you think Yelp chose to sell? ```hint Fit, fight and buyer Weigh what it took to compete in food ordering at the time against what Yelp's core business depends on, and consider who might value the business more than Yelp did. ``` ### Clarifying Questions - Should I analyze the decision as Yelp saw it at the time of the sale, or also judge it with what happened to the delivery market afterward? - Should I cover why the buyer wanted Eat24, or only Yelp's reasoning? - Is the interviewer looking for the strategic rationale, a verdict on whether selling was right, or both? ### What a Strong Answer Covers - Yelp's core business model and how a food-ordering business did or did not fit it - The state of competition in food ordering and delivery, and what winning would have cost Yelp - What the asset was worth to a buyer compared with Yelp, and the alternatives to selling - What Yelp's users and restaurant advertisers would keep or lose after a sale, and how that could be managed - Metrics that would show whether the sale was the right move ### Follow-up Questions - If you ran a competing delivery marketplace at the time, how would this sale change your plans? - What would have had to be true for keeping Eat24 to be the better choice? - How would you decide today whether Yelp should own food transactions again?