Geoff Donaker: Making the IPO Decision

So when and what did cause you to go public? How did you decide it's time? And there's a couple answers to that question. The longer kind of slow evolutionary answer is we always had this number in our head, probably a couple CFOs and CEOs we had talked to earlier had put it there, that was when you're at $100 million in revenue and you have some positive cash flow, you're probably ready to go public if you have a sustainable $100 million in revenue. And we were eking up on that at this point in time. So we kind of knew at this point— and this is, I guess, probably spring of 2011— we had a sense that we were going to do mid-$80 million in revenue that year. Business model was actually looking pretty consistent and growing still fast based on previous year. And we could sort of see it. So it sounded like, OK, maybe we're getting into that territory where we should be thinking about it. So that's kind of going on in the back of your mind all the time. And then funny enough, the straw that broke the camel's back was our then CFO, Vlado Herman, who had been an early employee and critical guy, resigned. He came to me one day and without going into gory personal detail, funny side story, his wife was also running finance at Facebook at the time. And they had two young kids. And they both had these crazy commutes. And high-class problems, clearly. But they're living this nutty lifestyle where they're both just working all the time and have these brutal jobs. And so he decides to— be the guy to put his hand up and say, hey, I'm going to go deal with the family for a little while. He gave us lots of notice. But that became the time when Vlado decided to leave. Jeremy and I kind of looked at each other and said, all right, well, I guess we've got to find a new CFO. Who are we looking for? And that quickly led itself to maybe now's time. Maybe we should go public. Funny enough how these things happen, right? As you're asking yourself these questions like, OK, who should we be hiring and what's the profile we're looking for, there are people who have been private company CFOs. There are people who have been public company CFOs. There's actually a relatively small pool of people who have taken a private company public. And the going public process itself is actually kind of a complicated tactical thing. And we thought it would be really advantageous if we were going to do it, we may as well use this opportunity when we're hiring to hire someone who's been through it once before. And so we did. We effectively drew up a spec that said, all right, here's what we're looking for. Somebody who preferably has worked at an internet company and been a CFO of a public internet company, who preferably has actually taken one of those companies public, him or herself, right? And last but not least, who has a shared sense of mission and value and purpose with those of us who actually work here so that we all pass the O'Hare airport test of— everybody know what that is? That's the if you get stuck in the O'Hare airport for 6 hours, can you actually hang out with this person and not want to cut your arm off? So it's kind of an important test to pass if you're going to hang out with somebody for most of your waking hours. So that actually turns out to shrink the universe of candidates pretty fast, right? It's like, OK, you've got to have somebody who meets all those criteria. And we were really lucky to find one. So Rob Kerlick, who's our CFO now, was the guy we found in 2011. But the way that we attracted him and candidates like him, or with profiles like his, was by saying, it's time. All you candidates know what Yelp is and you kind of know what our story is. We're going to go public. And we're trying to find the person that's going to take us public. And it enabled us to meet some fantastic candidates, including Rob, who we then brought on board.