One of Yelp’s biggest investors thinks the crowdsourced reviews site needs to find an Elon Musk-like buyer.

Shares were up by more than 5% on Tuesday afternoon following a call from activist investor TCS Capital for Yelp to explore strategic alternatives, including a sale.

In a letter to the board, the group (which owns more than 4% of Yelp’s outstanding shares) said it was disappointed with the company’s stock price, which has hovered between $30 and $35 per share for the past month. TCS said it believed Yelp “could be sold to either a strategic or private equity buyer for at least $70 per share” (a level the stock hasn’t hit since 2014).

That’s a big ask. Even Musk’s takeover of Twitter represented just a 54% premium over the day before he began investing in the social media company and a 38% premium over the day before his investment was publicly announced.

Barring the location of an extremely generous white knight, the group suggests that Yelp merge with Angi, formerly known as Angie’s List, which it has held a minority interest in for at least the past eight years. The combined company, the group said would form “a powerhouse in the $500 billion home services market.”

TCS Capital is Yelp’s largest external shareholder. Eric Semler, founder of the fund, called the company “shockingly undervalued” in the letter—and laid the blame at the feet of cofounder and longtime CEO Jeremy Stoppelman and the company’s board.

“Despite the stock’s poor performance, Mr. Stoppelman has remained CEO of the company for nearly 20 years,” the letter reads. “We believe he inappropriately runs the company as his private fiefdom—even though he beneficially owns only 5% of the shares outstanding (only slightly more than do we) and has no special voting rights. So how has Mr. Stoppelman managed to remain CEO in the face of such value destruction? We believe that the answer is the support he receives from a rubber stamp board mostly full of long tenured directors with minimal relevant experience or investment in the company.”

While the letter is full of the rhetoric you would expect to find from an activist investor looking to nudge a business toward a sale, it’s a bit less clear on why it believes private-equity buyers would be willing to pay more than double the current stock price. TCS Capital did offer to share a “long list of potential strategic buyers” with the board, but there was no indication that any of those potential buyers had an actual interest in purchasing Yelp.

Another option? TCS Capital itself said it would be willing to make a hostile takeover offer if the board doesn’t act on its demands.

“We have been patient and long-term oriented for several years,” the group wrote. “But our patience has run out. If necessary, we are willing to make a bid ourselves to acquire Yelp. Our group includes a major operating executive with many years of experience as the CEO of a public company in the same business as Yelp.”

While the stock hasn’t seen any big spikes in the past five years, Yelp is certainly still a huge traffic driver, with 73 million users and more than 265 million reviews. Sales have been on the rise at the company, with first-quarter revenues hitting $312 million, a 13% increase from the year prior.

Yelp, in a statement to Fast Company, said, “We have not heard directly from the investor regarding their views beyond what has been issued publicly, but as always, we welcome constructive input from our shareholders on ways to increase shareholder value.”


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