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Elevation invests in Yelp, up to $100 million

The initial investment of $25 million will be increased as much as fourfold through the purchase of stock from eligible shareholders.

Elevation Partners, the Silicon Valley private equity firm that counts U2's Bono among its investors, announced Wednesday that it has committed up to $100 million in funding for reviews site Yelp.

It's initially investing $25 million in the Series E round, and plans to increase the investment to up to $100 million through the purchase of stock from employees whose stock has vested, as well as other eligible shareholders. Elevation co-founder Marc Bodnick will join Yelp's board of directors.

The funding round comes just a month after Yelp was reportedly close to a $500 million acquisition by Google, and then is believed to have turned down the deal at the 11th hour. At the time, it was widely believed that Yelp may have made the about-face because a better deal came along.

"We have been able to grow and scale our business quickly, even in the tough economic environment of the last year--a clear indicator that we've only begun to realize the potential of local search," Yelp CEO and co-founder Jeremy Stoppelman said in a release. "This investment in Yelp provides us with even more capital to focus on scaling our already proven business model and we are thrilled to have Elevation as a new partner."

Translation: They think they can get much bigger than $500 million.

And Yelp is indeed growing fast. The company said it pulled in 26 million unique visitors in the month of December, and that the number of reviews on the site doubled last year. It's not quite as clear how much money it's making. The company makes the bulk of its money from advertising--sometimes controversially--and while it certainly has a wealth of local content, Yelp hasn't yet said anything vis-a-vis profitability.

A source close to the company, however, says that Yelp first achieved a cash-flow-positive status late last year.

The company's last round of funding was $15 million two years ago, led by DAG Ventures. Part of the rationale behind that round was for the San Francisco-based company to open a New York office, focused primarily on ad sales.

This post was last updated at 12:55 p.m. PST.