Yelp Expands Auto Services Offerings with $80M Acquisition of RepairPal

Yelp, the popular review platform known for its restaurant and business recommendations, has made a strategic move to bolster its presence in the auto services industry. The company has announced the acquisition of RepairPal, a website specializing in car repair estimates, for a staggering $80 million in cash.

This acquisition marks Yelp’s latest effort to diversify its offerings and capitalize on the multi-billion dollar U.S. auto services advertising vertical. Jeremy Stoppelman, Yelp’s co-founder and CEO, stated that the addition of RepairPal will “accelerate our broader services efforts” by expanding the company’s capabilities in the auto repair and maintenance sector.

While the partnership may seem unconventional, it aligns with Yelp’s recent focus on becoming a more comprehensive home services platform. The company has already introduced features like AI-powered recommendations for plumbers, repairmen, and other service providers, as well as Yelp Guaranteed, which offers up to $2,500 in coverage for qualifying projects.

RepairPal, founded in 2007, has managed to establish partnerships with major players in the industry, including CarMax, USAA, and Endurance Vehicle Services. Yelp believes it can leverage these existing relationships and RepairPal’s deep knowledge of auto repairs and pricing to enhance its own offerings for auto services businesses.

In the company’s most recent fiscal quarter (Q3 2024), Yelp reported a significant 11% year-over-year increase in advertising revenue from services businesses, with revenue growth of around 15% in the home services category alone. The acquisition of RepairPal is expected to further bolster Yelp’s position in this lucrative market.

The $80 million deal represents a successful exit for the San Francisco-based RepairPal, which had previously raised $21.3 million in funding from various investors over the past 17 years. While the founders – Aaron Tavistock, David Esser, and David Sturtz – will not be joining Yelp, the company has confirmed that all other RepairPal employees, including the leadership team, will be integrated into the Yelp organization.

This strategic acquisition underscores Yelp’s ambition to become a one-stop-shop for a wide range of services, from dining recommendations to auto maintenance and repair. As the company continues to diversify its offerings, it remains to be seen how this move will impact its overall performance and customer experience in the long run.

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