San Francisco: LinkedIn, an online destination for professional networking, raised $53 million from investors in a fourth round of financing, giving the company an estimated valuation of just over $1 billion, LinkedIn chief executive Dan Nye said.
Private equity firm Bain Capital’s Bain Capital Ventures led the investment round, and LinkedIn’s existing investors, venture capital firms Sequoia Capital, Bessemer Venture Partners and Greylock Partners also put in money, the company said.
Jeffrey Glass, Venture Partner at Bain Capital Ventures, said the $1 billion valuation is a “big number if you think about it in absolute terms.”
High valuations for Web 2.0 start-ups
A handful of Web 2.0 start-ups, providing people innovative ways to interact online, have recently secured high valuations.
Last year, Microsoft Corp invested $240 million in Facebook Inc, valuing the social network at $15 billion. This January, Slide Inc, a start-up that lets people create photographic slide shows for social networks, raised $50 million from institutional investors in a round that valued the company at $500 million.
Super fast growth and growing credibility as a business tool
LinkedIn, which is five years old, currently has 23 million members and is adding 1.2 million new members every month, to have more than 30 million people by the end of 2008. So far it has raised more than $80 million, including the latest round.
The average LinkedIn member is 41 years old with an income of $109,000, Nye said.The Mountain View, California-based company will use the funds to build its business further and introduce new features.It will also introduce its service in several foreign languages.
More than 1mn members in India, UK
Referred to as the “knowledge exchange,” it lets people connect with others in their profession, search for jobs, make recommendations and check references. In that, it differs from Facebook and News Corp’s MySpace, which centre around personal interactions.
The company also may make acquisitions with its new cash, Nye said.But LinkedIn, which is profitable and generates revenue from advertising and premium subscriptions, has no plans to go public, and is also not looking to get acquired, Nye said.