Goldman Sachs, Citigroup to Help Yelp with IPO

By Ed Silverstein November 09, 2011

Yelp is going to need help when it has an initial public offering so it has selected some prominent bankers. They are: Goldman Sachs and Citigroup, according to news reports.

The IPO could take place early in 2012 – perhaps in the first quarter of next year, say news reports. The Business Insider adds that Yelp was discussing a public offering as early as July. Back then, the company named a new CFO, Rob Krolik, who used to work at Move Inc., according to The Business Insider. He also was a key player in the 2004 IPO of, news reports said.

With the IPO, the company may be valued somewhere between $1 billion and $2 billion, according to a report from The Wall Street Journal. The New York Times said the value of the company would be between $1.5 billion and $2 billion in connection with the IPO.

IPOs for social media and similar companies have led to anticipation from investors. It was just last week, for example, when Groupon sold $700 million in shares, “the largest technology I.P.O. since Google’s in 2004 — despite a lack of profits and skepticism about its long-term sustainability,” The Times said. Although Groupon shares dropped in value on Tuesday, on its first day of trading Groupon shares jumped 30 percent. The company was valued at $16.5 billion, The Times said. Goldman Sachs and Citigroup took part in the Groupon IPO.

In 2009, Yelp turned down a $500 million offer from Google. It was valued at $500 million as of January 2010.

Yelp offers consumers online reviews of local businesses. Yelp includes some 22 million reviews. Yelp saw some 63 million users a month during the summer, The Times said.

The Times also reports that altogether the “local online ad market is on track to grow to $15.1 billion this year, according to Borrell Associates, an advertising research firm. That market is expected to grow to $26.9 billion by 2016.”

Also, Yelp has gotten more than $50 million from investors such as Benchmark Capital, Bessemer Venture Partners, DAG Ventures and Elevation Partners.

In other company news, last month a report on TechZone360 said Yelp Switzerland was available to users.

Ed Silverstein is a TechZone360 contributor. To read more of his articles, please visit his columnist page.

Edited by Rich Steeves

TechZone360 Contributor

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