Yodle, the online marketing company, has filed documents with the U.S. Securities and Exchange Commission (SEC) to release its initial public offering (IPO) and plans to raise $75 million.
Yodle was initially called NatPal and was founded by Nathaniel Stevens, Ben Rubenstein, Milind Mehere, John Berkowitz and Kartik Hosanagar in 2005.
The online marketing company assists small businesses to raise their online presence via web development, social media and Internet-based advertising. Yodle claims that it has already served around 45,000 local businesses in home service, medical and legal fields.
The company reported revenue of $162 million for 2013, which is up by 22 percent when compared to the revenue for 2012. Yodle's losses also increased to $10 million, when compared to $5 in 2012. Market observers believe that the losses for Yodle widened partly because of increased spending on product development and marketing costs.
Yodle says that it faces competition from companies such as Gannett and Hearst. However, the company also competes with other bigger Internet advertising firms such as Google, Yelp, Yahoo and more.
Research firm BIA/Kelsey suggests that local digital advertising market is estimated to grow and reach up to $53 billion by 2018, which is nearly double of $28 billion in 2013. Yodle will hope to capture a major chunk of the market in the near term.
"Yodle has filed for its IPO at an opportune time for a cloud-based advertising company focused on local businesses," says Matt Turlip, senior analyst at Privco, a private research firm. Turlip added that the strengths of the company include "a unique combination of cloud, mobile, social, and local that investors are interested in, and it does have immense potential for growth in the very large local business market."
However, the analyst also suggested that it will not be easy for Yodle. The company will have to adapt to high costs, slowing growth and lack of profitability in the industry.
The New York-based company has about 1,100 employees. The company hopes that the money received from the IPO will be used to pay existing debts and also make potential acquisitions.
The main underwriters who are dealing with the IPO release for Yodle are Deutsche Bank, Credit Suisse, Jefferies and Piper Jaffray. The pricing of neither the IPO, nor the exchange under which the company will trade its shares have been disclosed. However, Yodle plans to trade under ticker "YO."
