Congratulations to Linkedin (LNKD) becoming the first U.S. Social Networking player to cross into the IPO ranks. What a great launch it was today with the investment community clamoring for shares on the first day of trading moving the stock up from it’s initial offering price of 45.00/share up to $94.25 .
What an amazing accomplishment for a company with only $15.4 million in profit last year moving into the public arena and garnering a $9 billion market valuation. This will certainly create a frenzy in the VC and pre-IPO start-up markets. The big players waiting in the wings of course remain Facebook (speculated to have a $100 billion valuation at their IPO coming out), Twitter, Groupon, Living Social and others.
- Linkedin Share Prices On First Day of Trading
In my mind Linkedin is different from any other social network in three key areas.
- 100 Million Business Members – First they dominate the Business Social Marketing catagory with over 100 million members.
- Diversified Revenues – Secondly they proved out their revenue model on something other than advertising alone. Their revenue mix is interesting with a majority of their revenue coming from paid subscribers and then the balance from job postings and advertising.
- Real Value- Add – Third, they offer real value to the business community ranging from job seekers to hiring companies to business-t0-business networking and are not as subject to the whims of the general publics desire to share passing thoughts and media in a social networking environment. People on Linkedin actually nurture and curate their linkedin profiles with a lot more thoughtfulness and the perceived value is higher than most social sites. So I am a fan of the company.
The IPO Door Is Open – I am also very excited to see the pathway to IPO’s open up again. My hope is that companies have learned from the Dot.Com bust of almost a decade ago and that they bring real sustainable business models to the public arena. Obviously there are models to follow like Linkedin and Facebook in the social space. I spent over 2o years in Silicon Valley helping to build great companies like Apple, 3Com, Interwoven and others and it is good to see ” The Valley” buzzing again. Although this is not just a Silicon Valley win. I know of a lot of great companies across the U.S. ranging from NYC to Indianapolis that are all watching closely.
Congrats again to the Linkedin team. This means a lot to the entire industry. I wish them outstanding long term success.
Post By Warren Raisch | May 19th 2011
