LinkedIn is the social networking operator that just about every business person has received an invite to join from at least one person they know.
The company issued a press release this morning noting that it has secured $53 million in additional funding in a capital raise. This was its fourth and largest round of funding and is said to value the company north of $1 billion. What is perhaps more interesting than anything is that the finding was from a private equity-led group rather than from venture capital. Bain Capital Ventures, the VC unit of Bain, led the financing with additional reinvestment from the company's existing investors:
Sequoia Capital,
Greylock Partners,
and Bessemer Venture Partners.
Over 23 million professionals use LinkedIn to keep in touch with old contacts, to reach new contacts, to problem-solve, and more.
To top matters off, CNBC hosted the head of the company, Dan Nye, earlier this morning and the hint of going public was much more than a hint. It seems like you can probably expect an S-1 filing with the SEC in the relatively near future if things continue, although that timing could be later in 2008 or into 2009 or even never. But the 'we are going for valuations much higher than this' line was a hard one not to notice. Personally, I'll go ahead and 'bet the over' that we see an IPO filing in the coming months as long as market conditions don't go further awry.
I recently saw a presentation from Dan Nye, who is the CEO of LinkedIn. Of course, all the metrics were spiking. Then again, LinkedIn is the place for professionals to connect.
So, this week the firm has snagged $53 million in venture capital. The investors include Bain Capital Ventures, Sequoia Capital, Greylock Partners, and Bessemer Ventures. As a sign of their optimism, the valuation of the investment came to around $1 billion.
While Facebook and MySpace get lots of buzz, I think LinkedIn is a more interesting play. Basically, the company is leveraging user-generated content to build an immensely valuable database. For example, if an advertiser wants to target someone located in California that is interested in Linux systems, you will definitely get some hits. This is critically important. After all, many other social networks have a tough time monetizing things.
In November rumors circulated that business social networking company LinkedIn Corp. was looking to be acquired for more than $1 billion. Rival Plaxo Inc. now is also reportedly on the block, but its price tag may be closer to a far more modest $100 million.
Billed as a "digital assistant," Plaxo provides a free service that helps people keep online address book information up to date. The Mountain View, Calif.-based firm also offers premium services for $49.95 a year that provide portable data access, automated backup and recovery, and the ability to send e-cards.
A Plaxo spokeswoman declined comment on whether the company is for sale or on the value of a deal, which was reported by The New York Times. Boston investment bank Revolution Partners LLC, which is reportedly advising Plaxo, did not return calls seeking comment.
News Corp. (NYSE: NWS) reportedly is in talks to buy social networking site LinkedIn.
"A well-placed source has confirmed with us that these talks are serious," writes VentureBeat's Eric Eldon. "News Corp.'s strategy, from what we understand: Somehow integrate LinkedIn's network with the Wall Street Journal as well as its other newspapers around the world, hopefully figuring out how to recoup News Corp.'s newspapers' declining classified ad revenue in the process."
The strategy makes sense. Plus, Murdoch is eager to bolster the company's social networking business in the face of the rising popularity of MySpace. LinkedIn claims that 14 million professionals use it, representing every member of the Fortune 500. Its investors include Sequoia Capital, Greylock, the European Founders Fund and Bessemer Venture Partners.
As Murdoch has shown with the $5 billion acquisition of Dow Jones & Co. (NYSE: DJ), Murdoch is willing to pay up for something he wants and if shareholders benefit so much the better. Investors continue to be sour on the media sector and will be for a while considering the uncertainty surrounding advertising spending and the overall economy. Shares of News Corp., which recently said earnings were rising ahead of its forecasts, are down 3% this year.
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I recently saw a presentation from Dan Nye, who is the CEO of 
In November rumors circulated that business social networking company LinkedIn Corp. was looking to be acquired for more than $1 billion. Rival Plaxo Inc. now is also reportedly on the block, but its price tag may be closer to a far more modest $100 million.
