MOUNTAIN VIEW, CALIF. — LinkedIn Corp. has made a big connection with investors, who are valuing the professional networking company at more than $1 billion.
LinkedIn said Tuesday that it had received $53 million in venture capital funding from Bain Capital Ventures and three existing investors in exchange for a 5% stake in the Silicon Valley company.
LinkedIn has landed one of the richest valuations for a Silicon Valley start-up since Microsoft Corp. handed Facebook Inc. an eye-popping $15-billion valuation late last year.
Facebook's valuation triggered a social networking gold rush. Ning Inc. and Slide Inc. seized valuations in excess of $500 million, and RockYou came in at $200 million to $300 million.
Amid relentless buyout speculation from the likes of Microsoft and News Corp., LinkedIn executives remained mum on the possibility of an initial public offering but say they're charting an aggressive course as an independent company. The 5-year-old firm has been profitable since 2006.
With the infusion of capital, LinkedIn is poised to roll out corporate services and explore potential acquisitions as it swiftly adds users, customers and employees, Chief Executive Dan Nye said.
"We have a strong balance sheet and a strong business model," he said. "Now we have the luxury of being able to focus on building a great company."
Silicon Valley investors believe that social networks, with their rapidly growing audiences, will capture a growing share of advertising dollars.
But Mountain View, Calif.-based LinkedIn is a little different. It connects professionals with shared contacts and interests.
With 23 million members in 150 countries, more than half overseas, LinkedIn has said it could generate as much as $100 million in revenue this year from premium subscriptions, blue-chip advertisers, job listings and corporate services. It's all part of a massive shift, dubbed Enterprise 2.0, as corporate America increasingly turns to the Web for software and services.
"There are enormous opportunities to take the company to greater heights," Bain Capital Ventures partner Jeffrey Glass said.
For months, rumors have circulated in Silicon Valley that LinkedIn would raise a fourth round with a $1-billion valuation rather than go public or be bought out. Before this latest round -- which included previous backers Sequoia Capital, Greylock Partners and Bessemer Venture Partners -- LinkedIn had raised $27.5 million. It did so largely by tapping the vast personal network of its founder, chairman and largest shareholder, PayPal veteran Reid Hoffman.
