EmailPrint
back buttonBack to Tech Blog homepage

LinkedIn: the money keeps rolling in

October 23, 2008 5:00am
by Richard Waters

It’s not all doom and gloom among Sequoia-backed start-ups.

LinkedIn, which raised $53m in June at an eye-catching $1bn valuation, is at it again. This time the social network for professionals has pulled in another $23m - and at the same valuation, despite the collapse in stock prices since then, according to CEO Dan Nye.

When I spoke to Nye earlier, he was far more interested in talking about his new investors than the money itself. This round comes from four backers: SAP, Goldman Sachs, McGraw Hill and Bessemer Venture Partners (Note: an earlier version of this post omitted to mention Bessemer.) Nye says these strategic investors are there to open up new uses for the LinkedIn network, advancing its ambition to become a social platform on which a wider range of online business life takes place.

You can imagine, for instance, LinkedIn being built in SAPs’ enterprise software applications to power future collaboration services. According to Nye, the social network has very high penetration in the finance business, so money managers like Goldman Sachs could use it as a networking tool to do everything to drawing in more assets to checking out the references of job seekers (there are plenty of those right now.)

Also, the LinkedIn network can already be imported into the Business Exchange that has just been launched by McGraw Hill’s BusinessWeek - a service that lets users view content from around the Web that has been aggregated by people in their network.

The appearance of companies like SAP and Goldman as shareholders does not guarantee that ideas like these will pan out, of course. Nor does it necessarily mean that LinkedIn will ride out the economic downturn unscathed (Nye will only say that, for this year, revenues will rise by over 100 per cent and that membership, at 30m, is rising 2m a month.) But it is a strong endorsement for a company which has already found several ways to make money from its early lead, and which has displayed an expansive vision for extending the uses of its network.

October 23, 2008 5:00am in Internet | Comment

EmailPrint