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The user-generated review hub is among the latest in a string of social sites that have announced plans to go public.
The advertising-driven website plans to use the money to drive growth in new markets, better cater to businesses that generate its revenues and better integrate its content with mobile devices, Financial Times reported.
Yelp users have posted 25 million reviews since the company's launch in 2004. "Yelp built its ad business by attracting users that know what they want, just not who to buy it from — exactly when ads are most effective," TechCrunch reported.
Yelp advertising is expensive compared to industry norms, VentureBeat pointed out. "At a time when much online advertising is being sold for 60 cents per thousand impressions (CPMs), Yelp is charging some local advertisers $600 per 1,000 impressions," it said.
Still, the company has generated revenues from only 24,000 of the businesses that have been profiled, FT noted. "As a result, the company remains in the red," it said. Yelp generated $16.7 million in losses in 2011 while managing to create $250,000 in cash flows.
According to the Financial Times, "Unlike with other recent web company IPOs, nearly all of the proceeds of the deal are going to Yelp itself and will be applied to general corporate purposes."
Facebook, the highest profile of recent tech initial public offering announcements, has revealed no specific plans to use the cash it will raise by going public.
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