• by Laurie Sullivan , 5 hours ago

Yelp has agreed to acquire AI-powered lead management and communications platform Hatch for $270 million in cash, with an additional $30 million of employee retention to be paid out over two to three years.

The transaction is expected to close in early February 2026. Hatch will then operate as a wholly owned subsidiary of Yelp.

Jeremy Stoppelman, Yelp's co-founder and chief executive officer, believes the acquisition is an important step in the company's move to integrate more artificial intelligence throughout Yelp to support local businesses.

"Hatch is solving challenging lead management and communication pain points for services businesses, and we've been impressed by the innovative AI technology and traction they've built," Stoppelman said. "By bringing our companies together we will be able to help service providers operate and grow more efficiently."

Artificial intelligence (AI) lead management uses AI to automate and optimize finding and qualifying potential customers.

Hatch's technology helps home-services providers identify and convert leads to paying customers, identifying the specific leads most likely to convert through predictive lead scoring.

This data allows media-buying platforms to reallocate budget in real-time toward channels and keywords that historically have delivered higher-scoring leads. It supports automated bidding, and make dynamic adjustments to budgets.

Yelp and Hatch have worked together since November 2025, when they first announced a direct product integration.

Yelp has made several acquisitions in the past few years to dominate several verticals such as automotive. In November 2024, the company acquired RepairPal for $80 million to accelerate its growth in the auto services. The deal provided platform users with certified connections to mechanics and repair estimates.

The company's merger-and-acquisition strategy focuses on the quality of the lead versus the volume of leads, and moves search and discovery to book and hire companies within Yelp’s platform.

The goal is to support direct transactions. Now it can manage leads through Hatch.