Zomato, an Indian restaurant information and ratings provider that has expanded overseas with a string of acquisitions over the last six months, has announced its next purchase. The New Delhi-based company will acquire Urbanspoon as it prepares to take on Yelp in the United States.
The acquisition might have cost Zomato almost all of the money it raised in November, in a funding round that saw marquee investors such as Sequoia Capital participate. GeekWire reported on Monday that Zomato may have spent about $60 million for Urbanspoon, without naming sources. Zomato is now looking to raise $100 million, according to a Reuters report Tuesday that cited founder Deepinder Goyal.
Urbanspoon is present in the U.S., Canada, UK, Ireland, Australia and New Zealand, according to its website. Its acquisition will expand Zomato's coverage -- which is currently present in 130 cities across 19 countries -- and more than triple the number of restaurants and reviewers on a combined basis, the company said in its announcement.
“The biggest challenge and most fun part of this move, however, is the fight we’re going to be picking with Yelp. In the market they have dominated for so long,” Goyal said in the post. Yelp Inc. is listed on the New York Stock Exchange and is considerably bigger than the privately-held Zomato, even after its Urbanspoon acquisition.