Yelp Shares Rise After Lockup

While early investors in Yelp got their first chance to sell shares in the online reviews site on Wednesday, it appears they are holding on to their stakes for now.

When a so-called lockup period expires, a stock typically falls as investors sell their shares. In the case of Yelp, the stock is surging. Shares were up nearly 25 percent to more than $22 on Wednesday.

“It's refreshing to see insiders with discipline,” said Michael Pachter, a Wedbush Securities analyst.

Yelp stands out from its peers in this regard. Shares of both Groupon and Facebook slid sharply after the expiration of their lockups. Peter Thiel, the first outside investor in Facebook, spooked investors when he sold an additional 20 million shares at roughly $20, or nearly half the original offering price.

Many analysts were expecting the same fate for Yelp. Since mid-August, shares of the online reviews site have been hammered, dragged down in part by concerns that early investo rs would dump shares once the lockup period expired.

Despite the recent strength in its stock, Yelp still faces the same challenges of other young Internet companies. While Yelp is one of the most popular reviews sites on the Web, it is also struggling to convert more local businesses into paying users. Vendors have the option to spend money to serve advertisements and to manage their business pages. Consumers can access Yelp's reviews for free.

Revenue rose 67 percent in the last quarter to $32.7 million, but Yelp recorded a net loss of 3 cents a share.

The stock action on Wednesday seems to indicate that Yelp's biggest investors are holding on - at least for now. The company's five largest shareholders, Bessemer Ventures, Elevation Partners, Benchmark Capital, Max Levchin, and Jeremy Stoppelman, the company's chief executive, collectively own more than 80 percent of the company's stock. A Yelp spokeswoman declined to comment on Tuesday.

“That's so mething we didn't see with Facebook,” said Mr. Pachter. “Facebook clearly didn't have any control over Peter Thiel.”

Latest Updates on Hurricane Isaac

August 29, 2012, 10:16 am

By CHRISTINE HAUSER

The Lede is following Hurricane Isaac on Wednesday, which is lashing the Gulf Coast with rain and high winds. Updates will mix breaking news from our correspondents in the region with eyewitness accounts, photos and videos of the storm posted online. Readers are invited to send us witness accounts, photographs or video by posting links in the comment thread or contacting us on Twitter @TheLede.

Tech Start-ups Look for Space in New Neighborhoods

Chester Higgins Jr./The New York Times

Ideeli, an online fashion retailer, moved into offices at 1385 Broadway, a 23-story building in the garment district. 

A decade ago, in the dot-com boom, technology companies flocked to the neighborhoods along Broadway in , with most ending up south of an unofficial cutoff of 23rd Street.

Today, though, that Rubicon is being regularly crossed by a new generation of digital businesses that seem willing to trade Lower Manhattan and its perceived hipness for the more button-down precincts of Midtown.

More than 100 Internet-based marketing firms, retailers and social networking companies are based in the area between the Flatiron Building and Central Park, out of about 1,400 similar businesses across the city, according to data compiled by NYC Digital, an initiative started last year by Mayor Michael R. Bloomberg to promote the city's technology industry.

“The boundaries of Silicon Alley are definitely pressing outward,” said Jonathan Serko, a broker with Cushman and Wakefield who has worked to bring tech companies to Midtown. He added, “some of the companies are moving out of necessity.”

In pockets of downtown Manhattan, commercial rents have spiked in recent years as increasingly fashionable neighborhoods like Chelsea, Greenwich Village and the financial district have welcomed a surge of new businesses. Residential conversions have also gobbled up the types of industrial buildings that tech companies once favored.

At the same time, fledgling tech companies have become more cost-conscious than their predecessors, many of whom burned through their seed money in a short time, brokers say. Significant savings are possible in Midtown, where rents can be $40 a square foot compared with up to $70 a square foot in trendier areas, according to Cushman data.

GSI Commerce, which provides online services for retailers like Toys “R” Us, was subletting a 10,000-square-foot loft on Broadway in SoHo in 2011 when the company was acquired by eBay, prompting the need to expand.

“There are many spaces out there that are beautiful, don't misunderstand me,” said Jan Dobris, a senior vice president of GSI Commerce. “They just weren't good ways to expend dollars.”

The spaces that Ms. Dobris saw in SoHo, the financial district and Hudson Yards were around $60 a square foot, which was too pricey, she said. Eventually, she settled on 1350 Broadway, a prewar high-rise on West 36th Street.

In March, GSI leased the 25,000-square-foot third floor for about $45 a square foot, according to Malkin Holdings, the building's landlord.

There are other perks about Midtown, like the proximity of Penn Station, Ms. Dobris said. Several of her company's 100 employees travel frequently to GSI's headquarters in King of Prussia, Pa., and she said they liked having trains close by.

Attracting digitally focused companies like GSI is a priority for Anthony Malkin, the president of Malkin Holdings, which has renovated most of its Manhattan portfolio to lure new kinds of tenants.

At 1350 Broadway, he refurbished the marble-walled lobby and elevator cabs, adding small monitors that display weather and news, and upgraded the building's windows, lights and bathrooms. U Marketing, an ad agency with a big focus on digital platforms, moved to the eighth floor in 2009 and recently expanded into a next-door space.

Similarly, at the , which Mr. Malkin supervises, a continuing $550 million renovation has removed the walls on many floors to make offices more open.

The efforts may be paying off. This spring, LinkedIn, a social networking Web site, signed a lease for a 10,400-square-foot space on the 24th floor, Mr. Malkin said, to augment its 32,000-square-foot space on the 25th. Asking rents in the landmark 102-story skyscraper start at $50 a square foot, he added.

In opting for workplaces that are more conventional than the former warehouses where they began as start-ups, tech companies “are moving away from environments that are about creativity into those that are more ‘Let's get to work,' ” Mr. Malkin said.

Continuing Coverage of Hurricane Isaac

By MARC SANTORA

The Lede is continuing to follow Hurricane Isaac, which is expected to continue pushing through Louisiana on Wednesday. Updates will mix breaking news from our correspondents in the region with eyewitness accounts, photos and videos of the storm posted online

Witness to Rachel Corrie\'s Death Responds to Israeli Court Ruling Absolving Soldier

By ROBERT MACKEY

As my colleagues Jodi Rudoren and Danielle Ziri report, an Israeli judge ruled on Tuesday that the state bore no responsibility for the death of Rachel Corrie, an American activist who was crushed to death by a military bulldozer in 2003 as she attempted to block the demolition of a Palestinian home in Gaza.

Ms. Corrie, who was a student at Evergreen State College in Olympia, Wash., joined the pro-Palestinian International Solidarity Movement in January, 2003, and was killed two months later in the Gazan town of Rafah, which straddles the border with Egypt.

Photographs published by The Electronic Intifada on March 16, 2003, the day she died, showed that Ms. Corrie confronted the heavily armored bulldozer wearing a bright orange vest and holding a bullhorn. The same Web site also published sworn affidavits recorded within days of the deadly incident by three other international activists who were present when Ms. Corrie was killed. One of those witnesses, a Briton named Tom Dale, sent the following statement to The Lede on Tuesday from Cairo, where he now works as a journalist:

The verdict in Rachel's case is saddening for all those who knew Rachel, and for all who believe in what she stood for. It should be disappointing for all those who want to see justice done in Israel and Palestine.

On March 16, 2003, Rachel could not have been more visible: standing, on a clear day, in the open ground, wearing a high visibility vest. On that day, she had been in the presence of the Caterpillar D9 bulldozers used by the Israeli army for some hours.

She was standing in front of the home of a young family which was under threat of demolition by a bulldozer. Many homes were demolished in such a way at that time, and Rachel was seeking to protect her friends, with whom she had lived.

Whatever one thinks about the visibility from a D9 b ulldozer, it is inconceivable that at some point the driver did not see her, given the distance from which he approached, while she stood, unmoving, in front of it. As I told the court, just before she was crushed, Rachel briefly stood on top of the rolling mound of earth which had gathered in front of the bulldozer: her head was above the level of the blade, and just a few meters from the driver.

Those of us who are familiar with events under occupation in Palestine are may not be surprised by this verdict, which reflects a long-standing culture of impunity for the Israeli military, but we should be outraged.

I didn't have a chance to get to know Rachel as well as I would have liked, since we spent just a few weeks together, but I do know that she is a tremendous loss to us all.

Later on Tuesday, Mr. Dale elaborated on his statement in a BBC radio interview and a Skype interview with The Telegraph in London.

A video interview with Tom Dale, a British journalist and activist, posted online by The Telegraph.

Mr. Dale, who is now the news editor of The Egypt Independent, the English edition of the Cairene daily Al-Masry Al-Youm, noted in an e-mail on Tuesday that video he recorded late last year, documenting in vivid detail the use of force against Egyptian protesters, helped draw global attention to the use of violence against activists in Tahrir Square. “I was behind the camera filming the Egyptian army as it rampaged across Tahrir Square in December,” he recalled. “None of us had a video camera when Rachel was killed. I can't help but wonder now how much difference it would have made to the court case.”

While there is no footage of the moment Ms. Corrie was dealt a fatal blow by the bulldozer, the trailer for a documentary on her life and death does include Israeli military audio of the soldier who struck her reporting the incident, a nd images of her and other activists trying to prevent home demolitions on a previous day in 2003.

The trailer for “Rachel,” a documentary about Rachel Corrie.

The Israeli military's destruction of homes in Rafah was part of an effort to seal the border between Gaza and Egypt by destroying the tunnels underneath it used by smugglers to move goods and arms into the Palestinian territory.

Four months after Ms. Corrie was killed, the comic-book journalist Joe Sacco published “The Underground War in Gaza,” a New York Times Magazine report on the Israeli military's anti-tunnel operations in Rafah. That report from can be viewed elsewhere on this Web site as a slideshow or a .pdf.

In an interview with the Arab satellite network MBC, conducted just days before she was killed, Ms. Corrie herself spoke about the effort by international activists to prevent the demolition of Palestinian homes in Rafah .

A television interview with Rachel Corrie, an American activist, conducted by the Arab satellite network MBC in March, 2003, days before she was killed by an Israeli military bulldozer in Gaza.