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LinkedIn Is About To Go Public

Finally set to go public, LinkedIn on Friday had everyone asking why now, what it means for the social network, and which social-centric companies could follow suit.

"The decision by LinkedIn ... to snuggle up to Wall Street is significant because it's the first such social network to make the jump this year," writes The Register.

Likewise, eWeek sees the move as "potentially paving the way for Facebook, Twitter, Groupon and other Internet companies to join the publicly traded sector."

Adds GigOm: "While LinkedIn's offering won't quench the demand for IPOs from companies such as Facebook or Zynga, the fact that it's hitting the market first could not only help set expectations, and eventually valuations, for other hot startups, but also likely make it a stronger candidate because of its focus on business as opposed to consumer networking."

Meanwhile, as the Financial Times points out, an IPO doesn't mean that LinkedIn's management will lose control of the company. "Even after the IPO, the company is likely to be controlled by one man, Reid Hoffman, co-founder and chairman," writes. "He and others have a separate class of stock with 10 times the voting rights of the common shares to be sold publicly."

Public or not, LinkedIn faces serious challenges ahead. "Among other things," as VentureBeat notes, "the company lists security, government regulation, the fact that most of its traffic comes from a minority of users, and the challenge of balancing members' needs with moneymaking opportunities as risk factors."

There's also the little matter of Facebook, and whether it will seek to stomp out any competition in the social networking sphere.

Still, "For the first time, we have a clear insight into LinkedIn's financial health, and overall it is strong," writes Mashable.

Indeed, writes CNet, "Through a combination of advertising and business services, LinkedIn has managed to actually make some money in the process.




Read the whole story at GigaOm et al. »

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