Will Yelp’s IPO Prove High Demand for Shares?
The local review service Yelp has filed for a 2012 IPO that could raise approximately $100 million.
Going public has been in the company’s plans for a while. In 2010, it turned down an acquisition offer of $500 million from Google Inc, (NASDAQ:GOOG).
In its recent S-1 Securities and Exchange Commission filing, Yelp reported it has more than 22 million reviews, 61 million monthly unique visitors and 529,000 business pages claimed.
It earned earned approximately $12.1 million in revenue in 2008, doubling the number to $25.8 million in 2009. During 2011’s first nine months, Yelp saw $58.4 million in revenue; however, it is not profitable. Yelp lost $7.6 million during this time, slightly less than the $8.5 million lost during same period in 2010.
Yelp receives the majority of income from advertising and “other services” including Yelp Deals, partnerships and remnant advertising inventory. During 2011’s first nine months, Yelp saw $40.3 million in local advertising revenues, $12.7 million from brand advertising and $5.4 million from other services.
The company’s largest owners include Bessemer Venture Partners (22.5 percent), Elevant Partners (22.4 percent), and Benchmark Capital (16.2 percent). Individual owners include Max Levchin (13.8 percent), Yelp’s initial investor and a corporate board member, and Co-founder and CEO Jeremy Stoppelman (11.1 percent).
Yelp faces both a volatile market and stiff competition from Google (NASDAQ:GOOG) and other giant players. Internet IPOs are still hot though, as Groupon (NASDAQ:GRPN), LinkedIn (NYSE:LNKD) and Angie’s List (NASDAQ:ANGI) have proven in recent months. We’re still combing through the paperwork, and we’ll let you know what else we find.
Further Reading: Yelp Initial Public Offering Insider’s Look>>