We're hiring

We love digital - Call
03332 207 677
and say hello - Mon - Fri, 9am - 5pm

Call 03332 207 677

Stephen Logan

LinkedIn Valued at $4 Billion Prior to IPO

17th May 2011 News, Industry News, Social Media 1 minute to read

On Wednesday night, professional social networking site LinkedIn is going public. Investors will be able to snap up shares in the company for between $42 and $45 as it finally floats on the New York Stock Exchange.

That’s a pretty impressive figure, particularly for an established site that trails some way behind Facebook, the recognised market leader with over 600 million users. However LinkedIn does have a unique proposition that sets it apart from most other social media providers, as it is strictly a network for professionals. This gives it an inherent value; however, whether that equates to $4 billion worth of value remains to be seen.

Following the rigmarole that surrounded the IPO of Demand Media, which ended up being valued at around $1.5 billion, it appears that interest in LinkedIn is reasonably high. In fact so much so that they have raised the cost of the shares, from around $32 or $35 to $45. That’s a pretty big jump, especially for a company that is on the verge of going public.

This clearly indicates that there is still huge demand from investors seeking to own a part of online businesses. It’s hardly surprising either, as the numbers appear to show that LinkedIn is a company with significant potential.

The Wall Street Journal reports that net income rose by 14.1% in the first quarter of this year alone – to around $2.1 million. It also appears to have turned a corner in terms of its financing, having made a solid $15.4 million last year, after recording a loss of $4 million in 2009. This is largely due to the display advertising it features as well as the swelling membership, which now stands at around 100 million.

Whether LinkedIn is inflated at $4 billion or Skype is hugely overpriced with the $8.5 billion Microsoft splashed out remains to be seen. However interest in Internet-based businesses appears to be higher than ever before, with valuations seemingly reflecting this. Perhaps we are on the verge of another great bubble, or maybe they’ll prove to be great investments that continue to add value. Only time will tell.

Share this post

What do you think?

  • aspect-ratio
    Dan Rice

    What is the Difference Between Owned, Earned and Paid Media

    Search engine technology is evolving, and so is the digital marketing industry. The more experienced professionals amongst you may remember the days of gleefully stuffing keywords into your copy to boost your rankings, blindly spamming strangers to join your email lists and easily securing media coverage for your thinly veiled advertisements.

    (more…)

    Dan Rice
    @iamdanrice
    16th Aug 2018
    Content Marketing
  • aspect-ratio site-speed-blog
    Ross Momtahan

    A Guide To Page Speed Metrics

    Site speed is an important area of website optimisation that people working in the world of Search Engine Optimisation are becoming increasingly concerned about.

    With Google’s site speed update being rolled out to all users on July 9th, now is the time to audit your site speed if you haven’t done it for a while. (more…)

    Ross Momtahan
    20th Jul 2018
    SEO

Digital Ideas Monthly

Sign up now and get our free monthly email. It’s filled with our favourite pieces of the news from the industry, SEO, PPC, Social Media and more. And, don’t forget - it’s free, so why haven’t you signed up already?
  • We’ve got some really cool stuff we want to share with you. So you don’t miss out, let us know which of the following you want us to email you about going forward:
  • This field is for validation purposes and should be left unchanged.