Eric Risberg/AP

One of Yelp's largest shareholders, SQN Investors LP, urged management to refresh its board of directors to create significant value for investors. If not, SQN says it should sell the company.

Yelp traded above $90 a share back in 2014 when there were fewer business ratings and reviews platforms. But shares have since tanked more than 60%.

SQN said the stock's underperformance is largely due to poor corporate governance, and said it is prepared to launch a proxy fight if the board doesn’t make changes.

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Yelp jumped almost 2% early Wednesday after one of its largest shareholders urged management to refresh its board of directors to create significant value for investors.

The user-review website is a "unique and highly strategic asset that has significant runway to grow and expand profit margins if managed properly," SQN Investors LP, an investment firm that claimed it has a more than 4% stake in Yelp, said in a published letter.

"Now in our fourth year as investors, we feel we have given the Board and Management ample time to create value for stockholders. Our patience has now worn out."

Yelp traded above $90 a share back in 2014, when there were fewer business ratings and reviews platforms. But shares have since tanked more than 60% in the following years amid several executive departures and as tech giants such as Facebook entered the space.

Yelp's repeated strategic and operational missteps and poor corporate governance have led to the stock's underperformance, according to SQN. The firm said it has little chance to meet CEO Jeremy Stoppelman to address its concerns as a shareholder, and thus urged the company to refresh its board with new, independent perspectives, including the addition of a stockholder representative.

"Yelp is open to hearing any ideas and investor input, including from SQN," the company said in a statement responding to the open letter. "The Board and Nominating and Corporate Governance Committee are in the process, with the support of a nationally-recognized director search firm, of evaluating its composition and identifying additional Board candidates to help drive our strategy."

SQN said that if Yelp is not able to fix its problems and create stockholder value, it should consider a sale of the company. In 2015, The Wall Street Journal reported Yelp was looking into selling itself, but the plan was later revoked.

"If these discussions do not result in meaningful change, we must reserve all our rights as stockholders to protect our investment," SQN added.

Yelp was down 18% in the past year, trading near $35.60 a share on Wednesday.

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