Do-it-yourself social network Ning has added another $15 million to its coffers from LightSpeed Venture Partners, the company has confirmed to us. This brings the total capital raised to $119 million. Its other investors include Allen & Co., Legg Mason, chairman and co-founder Marc Andreessen, and Reid Hoffman.
Ning offers a counterpoint to the uniformity of Facebook, allowing anyone to create their own social network customized to their particular interest or social group. Earlier this year, Ning passed one million social networks created (it is now up to 1.3 million), but the key is how many of those are active and how many people they attract. In the U.S., unique visitors actually declined 10 percent from May, 2009 to June, 2009, according to comScore. Ning had 5.1 million visitors in the U.S. in June (its worldwide audience is about three times as large).
The company attributes the decline to “some downtime in June as we expand and optimize our infrastructure to support the growth that we are expecting in the next 12 months.” Ning says it is adding 4,000 new Ning Networks every day and one million registered users every 15 days.
One month hardly makes a trend, but Ning’s fragmented approach to social networks has yet to catch on in the way that Facebook’s monolithic strategy has in terms of activity or pure audience reach across the network. Back in April 2008, Ning had a half-billion dollar valuation, and now it’s supposedly $750 million. That is getting close to the inflated level Bebo was able to sell itself for, which we now know was too high. And Bebo still has more people using its product. (Even in the U.S., it had 8.7 million unique visitors in June).
Ning has been getting its act together, though. Back in December, it expelled adult networks from Ning because they aren’t advertiser-friendly. And that worked out well for them.
More recently, Ning has been working hard to make its social networks compatible with OpenSocial apps. That effort is going much slower than expected. A public launch was delayed last month because of performance issues with the Ning Apps platform, says one developer who is part of the program.
Maybe the new cash will help speed things along.
I still have high hopes for this company. It’s the kind of thing I want to see work — like the World Wide Web winning out against the AOL model for the Internet, I’d rather see the open platform of user-created social networks win out over the silos of Facebook and MySpace.
I’m all in favor of openness over a closed system but I can’t see any Ning created network ever getting anywhere near the size of a Facebook or Myspace broad-based one-size-fits-all for everyone SNS.
Ning is good for relatively small niche SNSs but it seems at least for the foreseeable future, mega large SNSs like Facebook will not be threatened by Ning – different needs for different markets.
These niche SNS’s will turn out to be where the money is. Facebook is becoming a generic interpersonal communication platform, which sounds good at first, until you think about how other similar services make money: they charge for the service. Yet, there is nothing so unique or defendable about Facebook to justify any margin on their expenses. Amassing all the eyeballs on the planet is great for founder egos, but requires you to become so generic, that you no longer have a marketing vehicle or a defendable identity. You are just a dumb pipe. It will turn out that Facebook should have stuck with owning the ivy league, students and alumni.
agreed, tim
I don’t really like the Ning profiles, its difficult to browse through
I like the idea of Ning and all but really who the hell uses them, most sites that I can think of that have anything to do with social networking in the broadest sense that uses ning are the official sites of some musicians beyond that I’m clue less to who uses it.
In my opinion, Ning is a social site for whatever one wants to expose. We chose it as a social site for WRITERS to impact lives and SELL TONS OF BOOKS. It’s the only such site in the world.
Many sites accommodate writers, but they are not writer’s sites, where they aid, nurture and help sell books. So it serves the unique purpose of being very niche for all organizations, people–for free.
Martha Tucker
I am someone who uses it Que. I don’t use it for the classic social networking features as much as most of the other Ning Owners.There are 180 members who share the same passion about a niche subject (NY Sports) that I do. They all have the opportunity to write themselves whenever they feel like it and have it read by way more people then if they took the trouble to start & market there own blog themselves.
The point is, it is a very flexible platform that gives someone the ability to be creative with how they want to start a website.
-NYSG
Not to sound negative… but i don’t think they will see the ROI for this kind of investment. It’s not a unique project and it’s easy to duplicate by any big player (eg, facebook, with its billions).
I think ning is like the new hotmail.
My 9 year old cousin created a network on it and invited all the family. Just as 10 years ago I created my hotmail account and emailed every email address I could come across.
Question is, will it be relavant 10 years from now? I’m not sure.
so the kid creates a ning email – big woop. he can now send an email to the 1 other active person in that niche community….how can this be the new hotmail?
The name ning throws alot of people off about what they offer. Could Ning harness a larger mainstream following if they had a name change? “MySocial” or something like that. Ning is an exciting platform that can change the world with greater anchor branding and better strategically aligned social channels.
also agreed, ning sounds like something, anything other than what it is
As far as Que’s question goes, a ton of communities exist on Ning that are worthwhile. To list a few I’m a member of that are all either based off very powerful websites or are powerful communities themselves:
1. 20SB (20-something Bloggers): http://www.20sb.net/
2. Art of Manliness: http://communit...fmanliness.com/
3. Minneapolis/St. Paul Social Media Breakfast: http://smbmsp.ning.com/
#1 has representation all over the web – on Brazen Careerist, etc. However, it really needed a home of its own for people to connect with each other in a more versatile way than Facebook groups/pages can provide.
#2 is based off the oh-so-popular website ArtofManliness.com and provides a great extension to its (essentially community) blog style.
#3 I could see doing just fine as a group/page on Facebook. The only reason it’s nice that it’s a Ning group is so that they can harness the portion of people NOT already on Facebook (or at least active on it). Of course, it’s a Ning site for social media addicts like myself but I’m confident enough to say there are other communities like this one on Ning that aren’t for those with a keen eye towards social media.
I think Ning will be big, when “discovered”. They need to build some imports and mass move users over. Belonging to multiple cliques is a very powerful concept and all they need is execution on both engineering and business fronts.
119mil is absurd…. There’s no way they can need this much money? Was this a founder cash-out round?
You can’t achieve word of mouth with a product that’s in the background…ning = geocities 2.0, just with no central brand name…which, in hind sight, was the only valuable thing out of geocities.
Besides…we had 3.5 million US uniques (google analytics) in June, up from may, and nearly 250% up year over year…
…ning can’t be worth 750 million. If they find a buyer for anywhere near that number, I’ll eat my pants & film it.
buy a video cam and start train yourself in eating and shooting.
What an ASTOUNDING way to waste money. What is going on with LightSpeed ? They were a great VC few years ago but now they’ve invested in companies so vapid and totally useless that it boggles your mind. Crap like RockYou and Ning… amazing that these guys are wasting so much cash on irrelevant crap that has no chance of ever being relevant.
What is Ning? Ning is nothing more than a much crappier version of Facebook fan page or a group. That’s all they are. They have so many sites on Ning and most of these have like 10-50 users each. They’re all wastelands. There’s relly nothing there.
And the valuation they got? Crazy. Andreessen has a bigger RDF than Steve Jobs!
Ning will never be a big company and they will never matter. They will just dwindle away into nothingness when this round of cash is gone. All they’ll do is leave a giant crater.
Well isn’t that it right there? It seems the investment into Ning is more about investing in Andreessen than in Ning per se – the belief that everything this guy touches will (eventually) turn to gold, based at least on his track record (netscape, loudcloud/opsware).
Time will of course tell.
Isn’t that what it’s all about anyway?
The investment in Ning is really about investing in Andreessen more so than Ning per se. The belief evidently that based on his track record (netscape, opsware), everything the guy touches (eventually) turns to gold.
Opsware was losing money during every year of its existence.
Only because of timing. It’s hard to sell the internet to companies when it’s just collapsed, financially speaking.
ning is great for startups. virtually levels the playing field for developers to provide users the same offerings as a facebook or myspace. those sites dont satisfy everyone. one thing i have learned is users want to be positioned on premium domain name social sites that best fit their genre. Our Ning site MiRaza.com now at 850 members with 60,000 page views with zero marketing. If your planning on going global your domain name is the most important choices you can ever make when creating a social site. companies like Ning put the software in everyones hands. The race is now about who can assemble the best network of “social position” channels (domains) users can call home.
Thanks for the data, Erick. Obviously a totally insane valuation, particularly when you think that even a late-stage private investor would be looking for a minimum 2x return. One question, though – does TechCrunch have a policy not to link directly to Kara Swisher?
Investments like these is what will lead to the next bubble burst when many of these sites start to fail. Its bound to happen.
congrats to Ravi and team @Lightspeed!
Ning has a YouTube problem. They subsidize video used by a lot of other sites, and that has to be expensive.
That would be a great problem to have!
I’m really having trouble understanding this deal.
Yeah – if you can explain this one you’d have my vote for a Pulitzer, if I had a vote.
MySpace was bought by News Corp for $580 million in 2005.
Bebo was snatched up by AOL in 2008 for $850 million.
Facebook was recently valued at $6.5 billion.
I can see someone at Ning’s headquarters pounding the desk and declaring, “We’re hot, and we’re worth $750 mil, not a penny less!”
Me not. They are insane.
Ning says it is adding 4,000 new Ning Networks every day and one million registered users every 15 days.
these are not relevant metrics. I want to see what the activity level is like; they’re a SOCIAL NETWORK. if there’s no activity, then what’s the point? creating a social network on ning is like creating a blog post (not a fully-fledged blog) if you cater to it for a week and leave it, nobody cares. including the people you invited.
but ning counts all of these ‘networks’ as growth. this is ridiculous. Facebook’s metrics in terms of users matter because the users are SOCIALLY active…even myspace.
Total BS. Look at the Compete or comScore numbers… they’re not even close to the BS they’re claiming.
99% of these new social nets they’re adding have less than 10 people in them. So what’s the point?
Complete BS. As an ex-employee — it is a lot of hype all started by Marc and made up by Gina. One of the worst places to work. The VC’s should have stepped in and brought a real CEO, and moved her out. Bleeding cash, bad morale, treats people badly. Users have nothing to do with each other across SN’s. Disclaimer: ex employee.
If you had actually worked there, you probably would have realized that they aren’t VC funded. Thanks for playing though…
Lightspeed is a VC and led this round. They should have cleaned up. Allen & Co is a Investment Bank with a Venture Capital Group that was in last round along with an Institutional Venture Fund. All VC’s + Marc.
With a reputation like Marc anderssson, i gues he has the ability to convince to the investers in grey waters….
it probably lay for more niche focus markets than the main consumer stream.
Well, in Ning’s favor is the likeliness that users will migrate towards niche and private social networks in the not too far away future, which happened with web 1.0’s social web users. In that environment, a white label solution could have legs.
Too much money too fast! How many social networking site do we need?
I agree the valuation is high.
But, I also believe that even the smaller Ning networks can be very valuable. I created a social network for our homeowners association. There are only 50-60 members, but it is a powerful and very effective way for the group to communicate, plan events and make decisions. It is a private network with new membership subject to approval. There must be 1,000s (if not millions) of examples of these types of networks that, when aggregated, can become quite valuable.
I would love to see Ning work but I agree with most that this is only for the niche SN’s. I’ve started a Ning account, fairly easy to set up and manage, the only drawback I’ve encountered is trying to get users. I agree that it will never match up to facebook but for small SN’s it could definitely be a great fit.
Does this deal make any sense? Ning is a tool like Six Apart and GeoCities. Tool companies do not get media or Facebook multiples. Movies make more money than professional movie camera sales. Very valuable to Ning’s publishers, but they capture a small monthly fee and don’t offer media.
What are their revenues and profit? Currently the trading multiples are 2-10 x revenue and 4-12 x profit. How much cash do they need given the problems of YouTube and Facebook cash needs?
Ads are offered by AdSense or Ad Networks- below $0.20 per 1,000 views or $200 per million. Ning does 100-200 million views based on Quantcast so revenue of $20,000 per month or a $1-2M business. Add
tool users, micro payments, etc – you have a $5-10M revenue business in 1009.
Ning is worth $20-100 Million at Google’s multiples. They would have to be $65-150 million in Revenue in 2009 revenue for this deal. Insider round, made up valuation, makes no sense.
Greetings. I agree that having numerous niche social networks on Ning with only a few members and no activity is not really relevant. But itβs great to distract investors and media and creates an illusion.
On the other hand being a member of a specialized, highly active and attractive nich-social network can work. And you can attract members that normally would not use Facebook and MySpace.
To give you some examples.
6800 members are on Gay Travellers Network. Gay men often have double income and they like to travel and spend money. So this is a great example for a healthy niche. It’s interesting that GTN was originally founded on Ning – moved to Zocku.com last December but moved back to Ning just some weeks ago.
Another successful example is Datedick.com. A social network for real men. They focus on masculine, bi, married, gay friendly men who are into nipples, hairy bellies and bulges. Not the typical gay stereotypes you would normally expect like young, muscled, hairless and good looking.
Sure this is a micro niche within the gay niche. But if you consider the demographics it can get interesting. There will be more and more baby boomers that are growing older. Those are often not only attracted to the typical gay mainstream like boys and twinks. Mature bi, married (often closeted) and gay friendly men in the 40s are already an interesting target group and this group will grow the coming years β due to the baby boom effect. And many of those don’t use generic social networks like Facebook nor MySpace till now. Often a niche social network is the first such users try out. Once they are hooked they can be very loyal and build a great and friendly community. Niche social networks can be way more focused, bring you to the things you like much faster and gather more people you really like around you. Those members are not interested to accumulate as many (often anonymous) friends as possible like many do on Facebook. They are very selective and decline friendships often. So itβs a different behavior in some niche social networks. More like in a private club where not everybody gets invited.
Datedick currently has 3500 invited members. Over 2500 members have been declined in the past because they where not compliant or inactive β so theoretical the member numbers could be much higher. But you get in by invitation only and you HAVE to show a profile photo. Moderation is pretty strict but on the other hand activity is pretty high. At peak months (November) they had 52.000 unique visitors p. Month, over 709.000 page views p. Month and nearly 9 min. average time on site.
fom
Wow! Bing is really doing great.
Ning needs a single sign on solution or an API I can hit to create a user account from my system. I can’t expect users of a core system register again to be part of the social network.
Has been a huge issue.
Agree with Brian. Facebook would have worked out a smart way to do this months/years ago. Ning’s development pace is hopelessly sluggish.
This is a cheap way for Lightspeed to get access to Marc A’s early stage venture deal flow. Worth 15m for the relationship.
Niche social sites, and similar sites, are going to replace or supplement blogs as places that create hyperlocal content, because blog content can be there as well as local information, and if created with SEO in mind, they will rank high in search.
Our little site http://www.twitterqueens.net on Ning serves the purpose very well and the members are active.
Very good point, diane. Totally agree – niche social sites = the new blogs. Yes – you could start a Ning site as a “rich” blog and remove all features like videos, photos, forum, chat at first. With one big difference – you can invite members who sign-up and who can be mass-mailed easily. And those members can interact with each other – something you cannot really do on a blog but via comments on posts.
So when we look back – coming from geocities, egroups, yahoogroups, blogs – all these functions can be replicated with a niche social network on Ning (and others like SocialGo). This flexibility is what many don’t understand. You have to moderate a social network on Ning to get it. It’s much more than a FB clone. You cannot ever do this with groups on Facebook. You are locked in their green garden. Yes – Ning is not “really” white label- but enough to brand it properly and do effective SEO and have your own ads. This is the future – we will see in couple of years. Thanks
fom
Yes, completely agree. Glad you said it.
This is the next version of Blogger… does everything that a blogging solution does, but with much more features and a social network component. Ning is a great solution for blogs and smaller websites… up to medium sized websites as well. Why all the hate? Some of your favorite websites just *might* be Ning networks — assuming that the website bought the “name” option and discarded the “Ning” suffix.
In my vision this will go even further. Imagine you would have an “empty” (or half-filled) framework like Google’s Wave The integration (with Gears) with the operating system is seamless: Drag & drop content. But also drag & drop third party apps, plug-ins and widgets that would expand your framework.
You can use presets and configure it as a social network, blog, news reader, daily startpage, “friendfeed” hub – whatever you like. It’s so easy to use.
You can move some of the widgets to your mobile device and take the wave with you.
The result – we don’t differentiate between operating system, application, browser (with app), desktop, mobile. All is synced, seamless and transparent.
You pick up a device that fits your lifestyle and go ahead. You will meet more people because you can go where they are and still be connected.
Real-life connection on the fly – like in that old dating bars with table telephones. Bluetooth pairing, matching and dating. A blend of work, fun and friendship.
So Ning is just opening up the niche factor – what we need is opening up the usability factor and choose our own tools – by multitouch and drag&drop.
DD
one of the most overrated companies of its era
Does Lightspeed have a corporate shirt policy?
Lots of gender diversity there.
Ning must be befitting from people spelling Bing.com wrong.
Gina – there are starving kids in this world, what you couldn’t do with 100MM what is 15MM more going to give you? Stuff like this makes me hate silicon valley
mind boggling…. maybe they just want access to Marc
good christ this turd continues to baffle me. apparently it gets nine trillion pageviews a day yet no one uses it. apparently everyone on the planet joins at least one ning network a day…yet no one has ever heard of them
got to hand it to marca, he has cooked up a brilliant scam here
FACEBOOK CONNECT WILL KILL THIS COMPANY…
Andreessen is on Facebook’s board, do you think he would let that happen? Think before you type!
Ning
Jan 2009
Unique Users 5M
Pages Viewed 250M
Minutes per User 33
Total minutes 158 million mins
Ning
June 2009
Unique Users 5M
Pages Viewed 100M
Minutes per User 10.4
Total minutes 53 million mins
Source: Quantcast & comScore
Looks like they lost 150M page views or 65% of their sites, and time spent down from 33 to 10 mins, and total time slashed from 160 to 50 Milllion Minutes. Adding users, but probably dropping earlier users- same problem as MySpace had and Facebook is starting to see now. Fact checking?
Wha, I thought they were adding “1 million users every 15 days”. Riiiiiiiiiiiiight.
I think 33 min is overrated. Does it mean actual active click time or that somebody would just log in and leave the browser. That would explain 33 min. Maybe they just change the wrong metric. 10.4 is still high but realistic. fom
Perhaps the largest networks aren’t tracked by Comscore?
Perhaps they use their own domains.
Please don’t let relevant data get in the way of the clueless ramblings of armchair entrepreneurialism.
Ning’s very flimsy, with less functionality from the site owner’s perspective than the average free online message board. Really it seems the Ning people don’t even have experience running a simple message board because of the startling omissions. (You can’t always delete inappropriate content people have added from your Ning network. You can’t ban members by IP address. And so forth.) Ning has stopped really communicating with network owners (they killed the forums where that used to happen). I regret starting a social network on Ning. I think they’re just looking for a fast payday because they’re not making Ning into the great service it could have been.
SocialGo sales rep with Ning envy?
The only site worth anything on Ning is the radio site 1club.fm and it appears that they are about to pull the plug on their Ning site and do something on their own. I have noticed over the past few weeks that they have slowly been pulling all of their main Ning content pages (like their special playlist groups, homepage, and other elements) off Ning and onto their own.
I contacted one of the owners of 1club.fm through his twitter stream and he has not responded but the writing is on the wall. It will be interesting to see what they do because as it looks now they are leaving Ning. They have 125,000 members and no longer promote anything about their social network.