Yelp has announced an agreement to acquire Hatch, an AI-powered lead management and customer communication platform, as part of its broader effort to expand AI-driven tools for services businesses.

The planned acquisition brings together Yelp’s large marketplace and brand recognition with Hatch’s software-as-a-service platform, helping both companies support services businesses as they adopt AI to manage growth and day-to-day operations.

Yelp said the acquisition is intended to accelerate its use of AI to help local service providers grow and operate more efficiently, expanding the company’s role beyond discovery and into business operations.

Jeremy Stoppelman, Yelp’s co-founder and chief executive officer, said the deal supports the company’s long-term AI strategy and addresses operational challenges faced by service-based businesses by bringing in powerful AI tools to local businesses. He said, “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.”

Hatch provides an AI-powered customer communication platform built to help businesses respond to inbound leads more quickly, automate outreach, and improve retention while reducing manual work and overhead costs.

Chris Bache, Hatch’s co-founder and chief executive officer, said joining Yelp will allow Hatch to scale faster and extend its tools to a larger base of customers, helping more businesses grow and succeed.

Under the terms of the agreement, Yelp will acquire Hatch for approximately $270 million in cash, with an additional $30 million allocated for employee retention payments to be distributed over two to three years.

As of November 2025, Hatch reported:

The transaction is expected to close in early February, subject to customary closing conditions, after which Hatch will become a wholly owned subsidiary of Yelp.

Q: What is Yelp acquiring with Hatch?
A: Yelp is acquiring Hatch’s AI-powered lead management and customer communication platform, along with its technology and team.

Q: What does Hatch’s platform do?
A: Hatch helps services businesses manage inbound leads, automate customer communication, and improve conversion and retention using AI.

Q: How much is Yelp paying for Hatch?
A: Yelp agreed to pay approximately $270 million in cash, plus up to $30 million in employee retention payments over two to three years.

Q: Will Hatch continue operating after the acquisition?
A: Yes. Upon closing, Hatch will become a wholly owned subsidiary of Yelp.

Q: Why is this acquisition important for Yelp?
A: The deal supports Yelp’s strategy to expand AI-driven SaaS tools that help services businesses operate more efficiently beyond lead discovery.

This acquisition shows how platforms like Yelp are extending their role beyond helping customers find services to shaping how those services run day to day. By bringing Hatch’s AI-driven lead management tools into its ecosystem, Yelp is positioning itself closer to the operational core of services businesses — where follow-ups, responsiveness, and customer communication directly affect revenue.

For services businesses, this points to AI taking on more of the work that happens after a lead arrives. Automating responses, managing follow-ups, and improving conversion are increasingly becoming software-driven processes rather than manual ones, especially as competition and customer expectations rise.

For Yelp, the deal reinforces a move toward recurring SaaS revenue and deeper workflow integration, rather than relying solely on marketplace discovery and advertising. As AI tools become embedded into daily operations, platforms that control both demand and execution may gain a stronger, longer-lasting relationship with business customers.

This acquisition highlights how AI adoption in local services is becoming practical and operational — focused less on experimentation and more on efficiency, responsiveness, and scale.

Editor’s Note: This article was created by Alicia Shapiro, CMO of AiNews.com, with writing, image, and idea-generation support from ChatGPT, an AI assistant. However, the final perspective and editorial choices are solely Alicia Shapiro’s. Special thanks to ChatGPT for assistance with research and editorial support in crafting this article.