foursquare, social networks, social media, location, sxsw

Dennis Crowley at SxSW earlier this month.

Foursquare is reportedly raising more venture funding to support its ongoing move into the local search space, but its valuation will likely remain flat at $600 million.

TechCrunch, whose founder Michael Arrington is a partner at the venture capital firm CrunchFund, first reported the company’s fundraising efforts.

The report indicates that venture capitalists will leave Foursquare’s valuation at $600 million, where it was for the company’s last fundraising round in June 2011.

The flat valuation is in some ways a triumph over naysayers. Crain’s reported in January that Foursquare was spending $2 million a month — as much revenue as it brought in in a year. Also in January, financial research firm PrivCo predicted that the company would sell in 2014 for less than the total venture capital it’s raised.

Still, nearly two years after its last round, investors would rather see Foursquare’s value going up.

According to AllThingsD’s Peter Kafka, Yelp’s market capitalization — at $1.6 billion, slightly less than three times Foursquare’s estimated value — puts an upper limit on Foursquare’s valuation. After all, by positioning itself as a local search engine, Foursquare also positions itself as an underdog competitor to the public company.