Three's A Trend: First Facebook, Then Zynga, Now Yelp

Yelp Inc. now has another thing in common with social-networking site Facebook Inc. and online gaming company Zynga Inc. Besides being a fast-growing, venture-backed Internet company, the local-business review site has opted to receive an investment from a private equity firm that gives its employees a chance to partly cash out–and the company more breathing room to remain private.

In a press release that just crossed the wire, Yelp said it received $25 million in Series E funding from Elevation Partners, the private equity firm known for its connection with U2 lead singer Bono and its investment in smartphone maker Palm Inc. (PALM). The Yelp deal also includes a provision in which Elevation Partners would buy up to $75 million of stock from “vested employees and other eligible shareholders.”

Yelp, which The Wall Street Journal and others reported had received an acquisition offer worth at least $500 million from Google Inc. (GOOG), has previously raised $30 million from venture firms including Benchmark Capital, Bessemer Venture Partners and DAG Ventures.

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