OpenTable’s Yelp Partnership Not at Risk as Reviews Site Acquires SeatMe
Yelp said Thursday it had agreed to acquire restaurant reservation startup SeatMe for about $12.7 million in cash and stock, based on Yelp’s current stock price. SeatMe sells software to restaurants and bars that helps them do things such as manage table assignments and accept online reservations, making it an OpenTable competitor, as it lays out very clearly on its own website.
On the surface, then, it’d be easy to assume — as some media outlets are — that Yelp is preparing to end its partnership with OpenTable, which currently powers online reservations on the reviews site. But in the press release announcing the deal, Yelp CEO Jeremy Stoppelman said, “We believe SeatMe will add online reservation capabilities to a broader market while complementing our existing partnerships.”
One of those existing partners? OpenTable. I reached out to Yelp to make sure that’s who Stoppelman was referring to, and company spokesman Vince Sollitto confirmed as much. I asked whether the acquisition is a precursor to the end of the OpenTable relationship or rather a complementary offering that Yelp hopes restaurants that don’t integrate with OpenTable might use.
“As for OpenTable, it’s more your latter assumption: As we state in our press release, we believe SeatMe targets a large, underserved market with a low-cost Web- and app-based solution, and that SeatMe complements our existing partnerships.”
There are still some unknowns here, such as whether Yelp will continue to charge for the product or perhaps offer it for free to businesses that advertise on Yelp.
Yelp has agreed to purchase SeatMe for $2.2 million in cash and 263,000 shares currently valued at about $10.5 million. The deal is expected to close next week.