Yelp Pushes Forward on IPO

As we�ve recently seen with Groupon (NASDAQ:GRPN) and Angie�s List (NASDAQ:ANGI), investors definitely have an appetite for tech IPOs — even with those companies continuing to post losses.

It should be no surprise that others are jumping into the fray. The latest is business-review website operator Yelp, which filed for an IPO late Thursday. Lead underwriters include Goldman Sachs and Citigroup.

Yelp is a platform for consumers to review and rate local business, such as restaurants, spas, salons, plumbers and so on. It�s a popular site, with roughly 61 million unique visitors every month. And its mobile apps bring in more than 5 million unique visitors.

Local business can actually �claim� their location on Yelp and make adjustments — such as menus and hours — as well as respond to reviews. That part is all free. However, if a company wants to get more exposure, there are a variety of advertising services.

So far, there are 529,000 claimed local businesses on Yelp. Of course, this is just a small fraction of the 19 million local businesses in the U.S.

For the first nine months of 2011, Yelp posted revenue of $58.4 million, up 80% from last year. But the company also lost $7.6 million.

Unfortunately, the market is attracting many competitors, including companies like Facebook, Microsoft�s (NASDAQ:MSFT) Bing and Yahoo (NASDAQ:YHOO).

But the biggest threat might be Google (NASDAQ:GOOG), which actually tried to buy Yelp a few years ago (as well as Groupon). Google failed, but it was able to snag restaurant review publisher Zagat.

Interestingly, Google searches account for more than half the visits to Yelp. But according to Yelp�s prospectus:� �Google has removed links to our website from portions of its web search product, and has promoted its own competing products, including Google�s local products, in its search results.�

It will take time for Google to get traction for its services � but it clearly has the resources and scale to be a big problem.� In other words, Yelp will likely try to get its IPO done as fast as possible.

Tom Taulli runs the InvestorPlace blog IPO Playbook, a site dedicated to the hottest news and rumors about initial public offerings. He is also the author of �All About Short Selling� and �All About Commodities.� Follow him on Twitter at @ttaulli. As of this writing, he did not own a position in any of the aforementioned stocks.