Nice dilution. But http://www.quantcast.com/ning.com does look nice.

Aren’t there a number of companies that provide user created social network free that kinda flopped?

Out of memory, I remember onesite which has networks completely empty or unused for more than a year : http://www.onesite.com/ .

How is Ning any different?

Wow, 221m? Ning is doing some good stuff but that’s big. And what are they going to do with 44m? Acquisition time?

I think Facebook as a billion dollar company is fair, but this smells a lot like an ‘associated bubble’ much like we saw for Skype and YouTube.

Again, wow.

Bloated valuations,
Merger madness,
Surging stock market,
Companies with no business model
+ Impending interest rate hikes,
High personal debt levels
=
Bubble 2.0

@3

LOL, you think Facebook at 1 billion is alright but skype and youtube being 1 billion is ludicrous? Wow. Just plain wow.

The money is certainly flowing, hopefully this is real and not another bubble

WOW. VC’s invest in people not ideas, but this seems like too much money even for Netscape founder.

Revenues…?

Do they plan to make money solely based on serving up ads? Is this sustainable? I’ll plead ignorance, so can someone fill me in on how their model works…

Ning is really cool but 221 mil, jeez, that seems crazy.

er…. 211…

#8.

I am not sure how their model works..but one thing I know, companies that rely solely on advertising may not last very long. This is because more and more people are becoming immune to online advertising. When is the last time you clicked on an ad online? In less than a year or two, you will see companies solely relying on advertising to start folding. Some of the new method are yearly subscription like Flickr althrough it may not necessarily sustain the site as you are not able to charge a high amount for yearly subs. These are just my thoughts.

#8 No, they also offer premium services:
http://www.ning.com/about/businesses.html

that is totally crazy. booble.

Chris:

“Some of the new methods are yearly subscription…” I wouldn’t really consider this a new method. =^)

Personally I don’t like the advertising model much, unless you are truly providing what your customers are looking for in an unobtrusive and convenient manner, something only Google does well in my opinion.

I don’t know that this means ad model sites will start dropping like flies. As has most always been the case, the best internet revenue models are based on multiple streams of income. If you are online only making money through only one revenue stream you are leaving a lot of money on the table.

The traffic today doesn’t seem to warrant the valuation, but I am guessing it has nothing to do with the traffic, and everything to do with the person. If MarcA were to start something brand new, it would instantly get a $100 million value, I would think, so in that sense, Ning is only 2x a “MarcA new start-up value”.

We run our social network on the Ning platform and love these guys. Great admin UI and front end flexibility. We’ve scaled to 560 members and 120,000 page views in a few months with pretty minimal downtime. These guys get it.

@5 No, I think Skype and Facebook were pretty fair (except getting Skype without the p2p tech is just dumb). It was the post acquisition surge of “me too”’s thinking - well if they did it, it must be easy.

Hey folks,

First congrats to Marc and Gina over at ning! They deserve a great deal of credit for the effort they are putting in to help their network creators in building and populating their sites.

As for revenue, these folks have huge potential that people who don’t use the site don’t easily see. First there is the premium services they currently offer, but those honestly are not the holy grail.

As someone who has a couple of unfinished ning networks, and a few more that will be created as they expand their offerings, I’m excited about the possibilities. For example with 10’s of thousands of small networks, the potential exists for an in-network store function, that contains a shopping cart and a paypal type of ecommerce solution. This alone will be worth it’s weight in gold.

As a ning network builder with limited php skills (like the majority of the general population), I’d happily pay them some premium dues to use these features, rather than trying to install them myself. Also my network of peeps will be encouraged to use the payment features to buy goods in my store and from my network.

That’s just one, and a pretty good one at that. I have more but will leave it at that for now. I know some of you will still say the 211 wasn’t worth it, that isn’t my point though.

More potential exists than what people who don’t use the site, will see.

Wow. Thats quite the bit of cash infusion - but Ning deserves it. They are really innovating and I am looking forward to see what they will be releasing over the upcoming months.

Ning must have some serious amount of traction to close a funding round this big. But I don’t know anyone who is using it…but I do know MySpace/FB/LinkedIn users. I wonder what Legg Mason thinks the exit amount will be? has to be over $1B.

High valuation are a double edged sword…if Ning ever needs to raise another round, getting someone to top this will be difficult. Not a spot I’d want to be in if that happens, but how quickly can you run through $44M?

I’m changing my name to Marc…maybe I’ll have as good luck with fund raising then, but for now I’ll settle for a nice table at Morton’s.

I don’t see the basis for such a lofty valuation.

Has Ning been approached by a major publisher with a high acquisition offer? If not, then the traffic doesn’t seem to warrant the price tag. Ning might be doing a good job, but it’s taken a lot of stumbling to get it right. It’s not a startup that came screaming out of the gates or has generated that much buzz from early adaptors.

This feels like a bubble event.

Michael usually has more to say about this type of valuation and I’m surprised by his lack of commentary. Perhaps too many VCs have too much at play for him to make a derogatory remark.

As Mike noted, Mark confirmed the $44 million on his blog:

http://blog.pmarca.com/2007/07.....new-i.html

That is a lot of money for any company. I hope the company is successful, but I also hope this isn’t showing the start of Bubble 2.0.

>WOW. VC’s invest in people not ideas, but this seems like too much money >even for Netscape founder.

they invest as they themesleves are NEPOTS not ideas.

onesite.com does the same exact thing.
I have NO CLUE why this Ning would be anything of value beyond that.
Just PR nd marketing bubble

hey invest in NEPOTS as they themesleves are NEPOTS

great ideas they pass until some NEPOT pitches those to them
In case of Marc he is actually a good guy from humble background but
most of those funds work that way

this is downright ridiculous. Marc you should start working on something
of reach that could dethrone GOOGLE not another social startup that
frankly with such valuation and what it does seems like ANOTHER
OOOOPPPPWARE HOTAIRWARE not another Netscape!

I use Ning for http://www.RecruitingBlogs.com and I think the site is amazing and the feedback I get from the over 300 members echoes the same. It cost me about $20 a month and this is so Ning does not place goole ads on the site. I would pay more if I could for things I would like that I have no idea how to build. I have no idea about valuations or stuff like that but this sounds like good news. They are always rolling out new features and respond to questions quickly.

“We’ve scaled to 560 members and 120,000 page views ”

scaled..?

I don’t have a community there yet, haven’t thought about a nice excuse to create one yet but theres quite a bit of people active throughout the communities.

Whats wrong with the business model running on ads? There is quite a lot of money to be made here, TechCrunch readers are too tech savvy to click on a link but again, what we see here doesn’t correspond to the real bulk of internet users.

Plus, Ning has some monthly subscriptions as well for businesses. Its quite expensive I think, but at least they are doing it.

Curious how Marc Andreessen stopped allowing comments on his blog. It was there, then gone. Did I miss an announcement?

I have been impressed with Ning, but the money is their because Marc Andreessen is. Money comes to those who have it.

I have been waiting three days to get a response back from one of their staff on a problem I was having with their technology, so maybe they are busy. But I have yet to be asked to join any group there, though I did create one mainly for fun.

“That puts the current value of Ning at a healthy $214 million.”

I don’t think it’s healthy. As other posters have pointed out, it borders on the ridiculous. I commented in previous posts about Ning that the service is simply the Web 2.0 version of ezboard or Yahoo Groups. To my knowledge, ezboard runs a decent business, but it’s certainly not worth nearly a quarter of a billion dollars, and neither is Ning no matter how you evaluate the business. Ning will face the same problems as ezboard and Yahoo Groups (lots of failed and neglected communities create a virtual ghost town, successful communities outgrow the service and move on, etc.) and is likely to develop into a similar type of business.

As several other posters have theorized, the funding likely has something to do with Marc’s status as a Silicon Valley luminary. And while investors invest in people more than they invest in businesses, guys like Marc are not the Silicon Valley equivalents of Jesus. In other words, they can’t perform miracles. The insane valuations given to Geni and now to Ning reflect irrational exuberance 2.0.

http://www.drama20show.com/200.....-the-ning/

This is really outrageous and if there’s any doubt in anyone’s mind that we’re on the verge of a serious market correction, just reread this announcement.

This is not a very sophisticated site. It wasn’t that long ago that Ning was trying to be a roll your own Craig’s List and that didn’t stick. Legg Mason, the VC company, is making a huge mistake. MySpace.com or Facebook could kill this site in minutes — it’s far too fragmented.

Might be wrong but methinks it speaks volumes that marc’s path to this round of funding appears quite long winded (and maybe generated a few ff miles). According to his blog post, he used a banker (allen & co - last I checked, they usually don’t work for free) and the deal was led by a non-conventional funding source (certainly as far as consumer internet plays go)….what happened to all the valley VCs? Or was this ostensibly a ’strategic’ round?

Pleased for the Ning team and hope this sets the bar low enough for a worthwhile exit for the ning founders/employees AND all the investors. And even if it turns out to be a shortsale (unlikely?), legg mason can absorb a complete loss - they are big boys over there.

Hi SorenG, we typically respond to emails within 48 hours but as you note we’ve been busy of late. We will look into your problem and make sure we get back to you as quickly as possible. Thanks for your patience!

You don’t need $44M for a consumer software company, unless they are looking to acquire companies/content (e.g. HomeAway - Redpoint deal). Until LPs decide to cut back their allocations in PE/VC sector we will continue to see rediculous valuation such as this.

I signed up for the site several weeks and was able to create a social network within a few minutes. Very easy to use and has most of the features needed to build a cool social site and has great functionality as well. I would definitely recommend this site.

Wow is right… There is a lot of money chasing yesterday’s dreams.

Hey, I’m just glad to see Marc is true to his advice on his blog. He said to raise a liberal amount of money and this is something he has done. Ever since Marc’s put out his blog I’ve been a big big fan of his, so more power to him.

Back in 1999 a friend of mine left his job to start an online music company, with no funding and no technology. A few weeks later I met him at a party and he told me he had just raised 140 million dollars in VC money.

He wasn’t joking, either.

At that point I knew the bubble was on its last legs- a blowoff top. Four months later the entire market started to collapse.

This smells and feels exactly like then.

This doesnt look good - that is too much money.

SorenG:

> Curious how Marc Andreessen stopped allowing comments on his blog. It was there, then gone. Did I miss an announcement?

See: http://blog.pmarca.com/2007/07.....rackb.html

Thanks Dar — and Diego for help at Ning.

wow - congrats to the Ning team.

This is somewhat amazing!

I’ve been keeping track of this market industry, Ning has 60 competitors

See this list of Companies that provide White Label Social Networking platforms

http://www.web-strategist.com/.....platforms/

Oh c’mon - call Ning for what it is: bubble. I think you hit the nail on the head when you were looking for them a year or so ago. Maybe having a meeting with the hottie CEO changed your mind? :-p