Yelp! last week began trading on the stock market and as if to bring back old memories, Wall Street has shown less then voracious appetite for the stock that slipped 14% on the second day of trading. Yelp! has had an interesting past with the story of its inception being one of turned down offers and unassailable self belief.
Reminiscing on the conception and birth of the company, co-founder and chief executive officer of Yelp Inc. Jeremy Stoppelman will be looking backwards at the opportunities he had to sell out but decided to stick it out. He recalls an offer worth $550 million form Google which he turned down because he felt the company was worth upwards of $1 billion.
This offer was followed closely by an offer from Yahoo, which offered first to pay $750 million but later upped their offer to $1 billion, both bids of which were declined by Stoppelman; he felt his company was worth at least $1.5 billion. But this may have been throwing out some good deals that he may be regretting at the moment. The company raised a paltry $107.3 million at its IPO on a valuation of $898 million, slightly below its value during the Yahoo bid.
But the company has seen some stellar performance at the NYSE with shares rocketing 64% to rest at $24 a share up from $15 when the shares started trading Friday. Shares however dipped 14% in trading yesterday in what is seen is a normalization of shares after all the hype is done.
Yelp boasts of up to 66 million active users and has a huge number of businesses that use the service to advertise but analysts are sceptical of the company’s revenue model, a fate that daily deals site Groupon also shares. Yelp market cap stands at $1.26 billion at the moment but its shares may slip even further in the coming weeks.