A year ago, Silicon Valley investor Roger McNamee was talking up the potential for Palm’s latest gadgets to put the iPhone in the shade – and getting into hot water with the SEC in the process (which led to this self-parodying video).
So Wednesday’s hurried sale of Palm to HP marks an ignominious retreat – even if Elevation Partners, McNamee’s buy-out firm, at least managed to protect its downside.
All-in, Elevation put $460m into Palm between 2007 and 2009 in what amounted to a big bet that it could corner a piece of the new smartphone market before slow-moving giants like Microsoft and Nokia (not to mention HP) finally got their act together. Read more
Local reviews site Yelp is facing some unflattering reviews of its own service.
In a class action lawsuit filed in Los Angeles federal court, the red-hot startup is accused of unfair competition and what amounts to extorting small businesses.
The plaintiff in the suit, an animal hospital in Los Angeles, alleges that after negative reviews about its business appeared on Yelp, sales representatives from the company called and said that for $300 per month, they could make the ads disappear.
Don’t be surprised if this sounds familiar. In a lengthy article last year, the East Bay Express leveled similar charges against the company. But in an interview with the FT, Yelp chief executive Jeremy Stoppelman flatly denied the claims. Read more
It was only last month that Yelp was almost Googled. The local reviews site came a breath away from inking a $500m deal to sell itself to Google, but for reasons still unknown, the deal ultimately fell apart.
The company, it seems, is not looking back. Today Yelp announced an investment of up to $100m from Elevation Partners, the private equity firm that counts U2 frontman Bono among its directors. Read more
In the world of Silicon Valley private equity, Elevation Partners has long stood out. It has a rock star among its founding partners, for a start.
It also takes big, hairy bets. You need a strong stomach to plough $460m into Palm. At last count that investment had roughly doubled in value, though Palm is still a long way from the finish line.
It’s equally hard to pass final judgment on some of its other big bets. A $300m-plus investment in games studios BioWare and Pandemic produced a 2X return within two years, though chunky investments in Forbes and internet real estate company Move look much tougher sledding.
Still, this week’s news of the first addition to the Elevation parternship in five years is a sign that it is now getting ready for round two. Read more