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Thursday, May 19, 2011

LinkedIn IPO - Bubble 2.0?

LinkedIn (NYSE:LNKD) is the first US Social Media company to go public (following Chinese social network site RenRen a few weeks ago). Incorporated in 2002, LinkedIn boasts over 100 million members. As stated by its CEO, Jeff Weiner, it is growing faster than one member every second. Original IPO was to be priced between $32 and $35 on Tuesday, shares went public at $45. Propelled by high expectations and possibly speculation, shares doubled in a matter of minutes. At the time of writing, shares were soaring 96% above IPO levels.

Are we experiencing the next bubble? Some experts don't seem to think so. Not yet. Revenues come from advertising, recruiter subscriptions and premium memberships. Last year the company generated over $250 million and is poised to do more than $400 million this year. So let's not talk about a bubble just yet, just a risky stock. It will be interesting to see what companies like Facebook, Twitter and Groupon decide to do after the reaction of the markets for LinkedIn stock.

LinkedIn operates the world’s largest professional network on the Internet, with its headquarters located in office space in California in Mountain View and offices in Manhattan, Chicago, San Francisco and other main cities throughout the US. Their network covers over 200 countries and territories.


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