Yelp, the San Francisco-based review website, could get a pop in its initial public offering if the overall market continues on a tear.
The IPO was priced Thursday as the company decided to offer 7.15 million shares priced between $12 and $14 in an offering managed by Goldman Sachs. Citigroup and Jefferies will be the joint bookrunning managers, with Allen & Co. and Oppenheimer serving as co-managers.. The company said it now hopes to begin formal trading on March 2. By then, the market surge of the past six weeks may change course.
At that price, Yelp would take in as much as $100 million and value the company around $780 million. Markets may rise Friday after the latest of several positive economic indicators.
Yelp's rival, New York-based Zagat, sold itself last September to Google, the No. 1 search engine, for about $225 million in a deal shopped by co-founders Tom and Nina Zagat. They were also the sole co-owners.
Yelp Chairman Max Levchin, 36, a co-founder of PayPal, used some of the proceeds from the sale of that company to eBay to found the company. He now owns 13.5 percent. The rest came from outsiders.
Yelp was financed by venture capital, with funds from Elevation Partners, whose investors include Irish rock star Bono; Bessemer Ventures and Benchmark Capital. The trio own nearly 60 percent of the company.
Yelp's IPO would be the first of 2012 for an Internet-based commerce site and could serve as a lead-in to the Facebook IPO, which seeks to raise at least $5 billion; however, Facebook's IPO might not be ready until the second quarter.
Fourth-quarter IPOs in the sector include shopping site Groupon and gamer Zynga, whose games run on Facebook. Since their respective debuts, shares of Groupon have lost 22 percent and Zynga shares have risen 27 percent.
Like both Groupon and Zynga, Yelp is not profitable. The prospectus shows its 2011 loss nearly doubled to $16.7 million as revenue rose 74 percent to $83.3 million.
Several others have done better: Jive Software, a business social network specialist, have gained 35 percent, while security software provider Imperva has seen its shares vault 40 percent since its November debut.