LinkedIn values itself at about $3 billion before IPO

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LinkedIn valued itself at about $3 billion as the social networking firm reported details of its upcoming IPO in a regulatory filing Monday.

The company plans to offer 7.84 million shares priced at $32 to $35 each, which would put the website’s value at about $3 billion. In 2010, LinkedIn made $15 million in profit on $243 million in revenue, according to the filing, which it submitted to the Securities and Exchange Commission.


The website, which is designed for professional networking, has applied for the New York Stock Exchange symbol LNKD. The company’s initial public offering will be underwritten by Morgan Stanley, Bank of America Merill Lynch and J.P. Morgan Chase, the filing said.

LinkedIn cautioned in the filing that its growth is expected to slow some in the future, in part because it is looking to invest money in building the site’s capabilities.

From 2008 to 2010, LinkedIn’s revenue grew from about $78 million to about $243 million, the filing said.

‘We expect that, in the future, as our net revenue increases to higher levels our revenue growth rate will decline over time, and we may not be able to generate sufficient revenue to sustain our profitability,’ the company said in the filing. ‘We also expect our costs to increase in future periods, which could negatively affect our future operating results.’

LinkedIn also said it doesn’t expect to be profitable in 2011.

However, the Mountain View, Calif., firm is looking to spend substantial money on building out its ‘technology infrastructure, including website architecture, development tools scalability, availability, performance and security, as well as disaster recovery measures,’ the filing said.

Another big area of investment this year for LinkedIn will be product development, beefing up its sales and marketing team, with a ‘significant expansion of our field sales organization’ and expanding internationally, to increase users and revenue, the filing said.


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-- Nathan Olivarez-Giles