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Yelp Faces Backlash Over GoFundMe Page for Small Businesses Hurt by Coronavirus

By Donna Fuscaldo - Mar 27, 2020 at 3:34PM

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Yelp teamed up with GoFundMe to raise money for small businesses but failed to alert some of the enterprises, resulting in backlash.

Yelp (YELP 3.07%), the online review site, is facing backlash for its efforts to help struggling small businesses amid the COVID-19 pandemic. 

Earlier in the week Yelp, in conjunction with GoFundMe, launched a campaign to raise money for businesses harmed by the pandemic. Through the campaign, individuals would be able to donate to the businesses via Yelp. 

Online review on a computer.


While it was well-intentioned -- Yelp and GoGundMe vowed to match up to $1 million in donations -- neither company got permission from the businesses first. That led to backlash, with some small businesses expressing their outrage on Twitter.  

A Yelp spokesperson told The Verge that in an effort to get businesses help quickly and easily it automatically added the initial group of businesses that are eligible for donations. But since learning some businesses didn't receive an alert with opt-out instructions and others wanted the option to opt-in on their own, Yelp has paused the automatic rollout of the donation feature. Yelp said it's working with GoFundMe to deliver a way for businesses to opt into the program. 

"We have received a great deal of interest and support for the program from both consumers and businesses alike," the Yelp spokesperson said. 

While Yelp said it doesn't get any of the donated money, donations through GoFundMe could be subject to payment processing fees. According to The Verge, critics of the program contend that GoFundMe set the recommended tip at 15%. GoFundMe takes a cut of those tips. 

With the COVID-19 pandemic rapidly spreading across the U.S., scores of restaurants, bars, and small businesses have been forced to close. That's putting many of them at risk of going under if the shelter in place orders remain in place for several weeks or months.

Donna Fuscaldo has no position in any of the stocks mentioned. The Motley Fool recommends Yelp. The Motley Fool has a disclosure policy.

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