LinkedIn files for IPO, reveals sales of $161 million

NEW YORK (CNNMoney) -- Business social network LinkedIn filed for an initial public offering late Thursday, offering the first public glimpse into the finances of the seven-year-old Web company.

LinkedIn turned a profit of $10.1 million on revenue of $161 million in the first nine months of 2010, according to documents filed to the Securities and Exchange Commission.

But it may not last: "We expect our revenue growth rate to decline, and as we continue to invest for future growth, we do not expect to be profitable on a GAAP basis in 2011," the company warned in its filing.

In 2009, its last full fiscal year, LinkedIn had a loss of $4 million on sales of $120.2 million. The company has been in the red every year except 2006, when it turned a slight profit on revenue of $32 million.

The company isn't hurting for cash: It's currently sitting on a stash of $89.6 million. LinkedIn filed to raise up to $175 million in its offering, but that's a preliminary number and companies often change those targets as they get closer to their IPO.

The professional networking site launched in May 2003, and it's now adding one new user every second. LinkedIn has more than 90 million users, with more than half of its members located outside of the United States.

Tech IPO market finally starts to thaw

But LinkedIn warned about increased competition both stateside and overseas, naming Facebook, Google (GOOG, Fortune 500), Microsoft (MSFT, Fortune 500) and Twitter as rivals who "could develop competing solutions or partner with third parties to offer such products." It also called out Xing in Germany and Viadeo in France.

In the three months ending in September, 65 million unique users visited LinkedIn's site.

The company now has 990 employees -- though many of them are newbies. LinkedIn said that more than half of its staff has been with the company for less than one year, and 74% joined within the past two years.

CEO Jeff Weiner pulled in a $250,000 salary and a $211,055 bonus in 2010.

LinkedIn has a dual-stock structure, which gives the company's insiders sigificant control over shareholder decisions even after others become stockholders. Google and Facebook have similar structures.

Co-founder Reid Hoffman and other executives hold Class B shares, which have 10 times the voting power of the Class A shares LinkedIn will sell to the public. It's a structure that's controversial with shareholder advocates but popular among Silicon Valley companies, which want to ensure that their founders are able to enforce their vision.

"The holders of our Class B common stock collectively will continue to control a majority of the combined voting power of our common stock even when the shares of Class B common stock represent as little as 10% of the combined voting power of all outstanding shares," LinkedIn wrote in its SEC filing. "This concentrated control will limit your ability to influence corporate matters for the foreseeable future."

The path to IPO: LinkedIn has raised more than $100 million in venture capital funding from big names including Goldman Sachs (GS, Fortune 500), McGraw-Hill, Sequoia Capital, Bain Capital and Greylock Partners.

The company has been open about its interest in an IPO.

In an August interview with Bloomberg, CEO Jeff Weiner said, "an IPO, being public, raising money -- that's really a tactic that helps us ultimately achieve that long-term objective."

Investors have been snapping up LinkedIn stock on the secondary market, where accredited investors can buy shares of companies that don't trade on public exchanges. SecondMarket, the largest private-stock exchange, said recently that LinkedIn represented 7% of its transactions last quarter -- a distant second to Facebook's 39%.

On SharesPost, a smaller rival exchange, shares of LinkedIn have traded in the last quarter at prices of $22 to $23.50 per share. That gave the company an implied valuation of $2.2 billion.

This is the second bit of tech IPO news in as many days. Demand Media (DMD) opened 2011 with a pop for the Web sector: Its stock ended 33% higher after it made its public debut Wednesday.

by Julianne Pepitone CNNMoney.com January 27, 2010

http://cnnmoney.mobi/wk_snarticle?articleId=urn:newsml:CNNMoney.com:20110127:linkedin_ipo:1&category=cnnm_business

The Birth of the Virtual Assistant

The Birth of the Virtual Assistant

January 31, 2010 Dag Kittlaus 25

Dag Kittlaus is the Co-Founder and CEO of Siri. He is a serial innovator and consumer wireless Internet veteran of 10 years in both Scandinavia and the US. Siri is Dag’s third consecutive mobile product.

In the near future, anyone who lives a connected lifestyle will be able to delegate their everyday tasks to intelligent virtual assistants that will coordinate, execute and simplify users’ lives.

We will look back on these days and ask ourselves how we ever got by without our trusted assistants, the same way my kids ask in amazement about how we ever got things done before laptops and the Internet.

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What Constitutes a Virtual Assistant?

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For a long time, Hollywood has been portraying machines that humans can converse with, delegate tasks to, and command. Remember the HAL 9000, KITT the car, COMPUTER from Star Trek, or even the brilliantly conceived and visualized Apple “Knowledge Navigator” from over 20 years ago?

They have symbolized our desire for trusted machine assistants that can help make our lives easier. They have persisted in the creative works of science fiction writers for decades. But have you ever asked yourself why that is? Looking beyond the theatrical and dramatic value of these ideas, the reality is simple — we have always desired more help, less hassle, and higher productivity in our lives.

What about search engines? Aren’t they the modern day version of this? No, at least not the search engines of today.

Search is a fantastic tool to help you find information on the Internet, but try to ask a search engine to actually do something for you. Try typing “get me a seat on the next flight from Chicago to Seattle” and see what happens. Or ask your favorite search engine to book you a table for three at Gibson’s steakhouse in Chicago for the day after tomorrow. Today’s paradigm of 10 blue links doesn’t cut it, and we need a new tool to help.

We need software that is specifically designed to help you get things done — a “Do Engine” rather than a search engine: A virtual assistant.

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Intelligent Cohesion of the Tools We Already Use

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Here is the good news: The elements, technology and ecosystem needed to build machines and software that can automate many of the mundane tasks of our lives are here already.

We just need to add a little intelligence. It will take some time, maybe 3-5 years, for the concept to mature. But when it does, it will emerge as the most frequently used and trusted online tool. It will make the most common actions on the web as simple as having a conversation. It will integrate into your life, get to know you, and be proactive.

In some sense your smartphone is starting to work like this already. There are already tens of thousands of services, apps, and sites that help you find and do things on the web and in the world. The problem is that they are all islands unto themselves, typically focused on a limited domain, and don’t often work together. They rarely share data or context with each other, have different user interfaces, and require users to spend a good amount of time to discover them, sign up, and get started. In terms of unified personal services, it’s not ideal.

Virtual assistants will help unify these and get them work together at your command. It would be nice to simply pull out your phone one day and tell it to move your 3 p.m. meeting to 5 p.m. and alert everyone invited of the change. That day is coming sooner than you think.

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A New Chapter for the Web

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There is a direct relationship between simplicity and user engagement on the web. Less clicks means more users — period. When combined with tools like smartphones, virtual assistants will migrate user interactions towards a far more frictionless e-commerce, consumption and collaboration model.

You will soon pick up your phone and start asking your assistant things like “take me to live CNN news,” “send my dad the latest John Grisham book,” or “tell Adam I am running 20 minutes late,” and you will then watch it all happen. This evolution towards simplicity of interaction will reduce the barrier to almost everything you use your mobile device to do.

Furthermore, the device is always with you. The combination of simplicity, impulse opportunity, context, and preference will create the most explosive market opportunity in ages.

This will be a market in which every player along the line wins. Users will be able to click less, enjoy simpler interactions and receive much-needed help getting things done and managing their day. Participating service providers get simpler discovery, more transactions, and higher consumption rates. This then drives more data dollars to networks, fueling infrastructure expansion.

As proof, witness what a cool device called the iPhone() has managed to accomplish through a snappy and simple interface with shiny buttons and creative apps. That one device and the competitive response we are now seeing has created a complete transformation in computing.

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The Anatomy of the Virtual Assistant

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The OS of virtual assistants will be the Internet itself, as Kevin Kelly postulated years ago. The brains will be AIs that are developed by software companies for both general purpose and targeted domains. The arms and legs will be web APIs (many of your favorite brands and services), and the connective tissue will be authentication protocols like OAuth and Open Social, and trust circles like those of Facebook().

The rapid maturation of technologies that enable free-form interaction such as natural language processing and speech recognition have vastly improved, to the point of gaining real adoption in many applications today (e.g. Google Speech, Nuance Dragon Dictation, Ford Sync for cars). Virtual assistants will leverage these inputs and begin to integrate them with conversations for a simpler, more natural way to get things done. This concept was best described by the late pioneer from MIT, Michael Dertouzos, who called it “human-centric computing.”

Over the long term, this paradigm will expand to many (or most) of the online services and tools we use to manage our lives like booking, buying, reserving, reminding, and scheduling. As we build trust in our digital “partner” we will put more and more onto its to-do list.

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Trust is Key

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The vague promises of contextual awareness, personalization, and other generalizations have rarely materialized in real products on the web. We are wary of what personal information we share online, in search engines, and the the never-ending fear of credit card fraud still looms. But this game is changing with the open web.

Mark Zuckerberg is indeed correct that privacy is dead on the Internet among the digital generation. Hundreds of millions of people spend a great deal of time telling the world all about their personal interests and information that forms their “digital face” on sites like Facebook, LinkedIn(), Twitter() and others. This will only expand as the demonstrable benefits of this effort become more apparent.

The paradigm shift we will see with virtual assistants is that providing them with access to your preferences, tastes, accounts and more will be the cornerstone of the simplicity they will enable (within a very secure environment, of course). In other words, where we once feared how long search engines kept our personal information, we will now go out of our way to expend time and effort to specifically provide our trusted assistant detailed information about ourselves.

This will be done both manually and via syncing with existing sources of our personal data such as Facebook profiles, iTunes() music lists, and contacts. The point is that you will make your virtual assistant definitively yours.

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2010 and Beyond

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The experience will be like hiring a new assistant that doesn’t yet know you, but eventually becomes so familiar that you can’t live without him or her. Keep your eyes on this space, try out these products as they emerge, and prepare to make your life a bit simpler over the next few years.

As John Battelle has said: “The future of search is a conversation with someone you trust.” 2010 will be the year in which we start to see real progress towards this vision, on many fronts.

Posted using ShareThis

Social networking sites look to build profit

Social networking sites look to build profit




by Matt Moore Associated Press - Jan. 28, 2010 12:00 AM

DAVOS, Switzerland - The leaders of Facebook and other social-media sites have long seen some grim writing on their wall. While spectacular popularity has turned them into household names, they haven't found a way to transform all those friends, fans and followers into profits.

On Wednesday, in a rare encounter of rivals, the chiefs of Twitter

, MySpace, Facebook and LinkedIn met with industry experts at the World Economic Forum to strategize.

The common theme: developing social networks so they get beyond socializing to drive humanitarian causes or help businesses better communicate with customers to increase sales.

While participants touted social media's ability to reach out, form relationships and keep people and businesses linked together, they offered scant insight into how the companies can make money, cashing in on their enormous fan base.

"What's important for them is to become indispensable to consumers," said Augie Ray, a senior analyst for social computing with Forrester Research Inc.

"For Facebook, one of the interesting things is the value of advertising that is super relevant and also increasingly involves the preferences and actions of your friends," he said.

Facebook, which draws revenue from advertising posted down the right side of its site, has generated buzz about a possible initial public offering this year. The site created a dual-class stock structure in November, a move that is typically a precursor to going public.

If it does go public, Twitter and LinkedIn may be tempted to follow, he said.

Evan Williams, chief executive and co-founder of Twitter, the wildly popular micro-blogging tool, said more and more small businesses were listening to their customers via the site, capitalizing on the way individuals build relationships across social-media platforms.

"This is the heart of what a lot of social networks are about, they're about communicating ... but they're also about relationships of all types," he said.

"Some of the stuff we're excited about with Twitter is an individual will follow a local business, a coffee shop, and get their special of the day."

Experts see huge business opportunities remaining in social-media sites. More and more, though, sites are migrating to a business-oriented landscape with posts from friends seeking work, restaurant recommendations or the best places to buy cars or computers.

That, in turn, means that "social media is becoming the operating system of a business," said Don Tapscott, chairman of nGenera Insight, an information technology think tank.