It’s no secret that hyperlocal’s most prominent public company has not set a sure course for others to follow. Groupon’s (NASDAQ:GRPN) quick rise, followed by an ever declining share price, massive sell-offs and negative investment recommendations would seem to signal doom for any hyperlocal company going public.
Meanwhile, Yelp (NYSE:YELP)has stood as an antidote to the symbolism of Groupon. A company solidly on the rise, confounding short-sellers, sailing through the conclusion of a lock-up period, and sending assurances that an Internet company, one focused on local marketing, can not just survive but win in the public markets.
Which one holds the template for others in hyperlocal? Indeed, each story represents either end of the spectrum of hopes for investors and entrepreneurs, and specifically in this sector. Over the last six months, with our Hyperlocal Investment Report newsletter, we have aimed to guide investors through this new industry, to give context and insight into the market potential of pre-public companies, and to synthesize activity in the public markets as well as in private placement, venture capital, mergers and acquisitions, private equity and the like. We’re very proud of this great product, with its strong analysis and unique focus on hyperlocal investing. And with this issue, we’re moving it from a paid product to delivering this content on our public website for free, to engage in broader discussion around key issues in hyperlocal investing.
We know there is a strong representation of hyperlocal companies in the public markets — you can see that in our Hyperlocal Stock Index (right). And of course every VC firm worth its spot on Sand Hill Road has placed a bet on hyperlocal, from Foursquare (Andreessen Horowitz) to Nextdoor (Benchmark Capital) and Zaarly (Kleiner Perkins Caufield & Byers).
There is huge potential in this market — $100 billion in revenue collectively by 2020, according to McKinsey Global Institute.
Our final issue is as smart as they come, with look-back analysis of strategic moves in the reviews, payments and local-social arenas, plus an examination of the sale of Yext’s Felix unit to CityGrid, and a piece that tells you why August investments were up, down, and sideways. We hope you enjoy it, and look for more on the pages of Street Fight!