Submitted by Anuradha Gupta as part of our contributors program.
LinkedIn (NYSE:LNKD), the world’s largest professional network on the Internet with 161 million members worldwide, agreed to acquire Slideshare, a leading professional content sharing community. The transaction is valued at approximately $118.75 million, subject to adjustment, in a combination of approximately 45 percent cash and approximately 55 percent stock. Over the past few years, Slideshare and LinkedIn have been working closely together to help professionals be more effective and productive through the content they create and share on LinkedIn.
The acquisition of Slideshare is well fit with the LinkedIn’s business synergy as Slideshare had nearly 29 million unique visitors, ranking it among the most heavily trafficked sites for professional content. Slideshare helps professionals discover people through content, and content through people. These presentations also enable professionals to discover new connections and gain the insights they need to become more productive and successful in their careers, aligning perfectly with LinkedIn’s mission and helping us deliver even more value for LinkedIn user. The company is publicly held and has a diversified business model with revenues coming from hiring solutions, marketing solutions and premium subscriptions.
Founded in 2003, LinkedIn connects the world’s professionals to make them more productive and successful. With 161 million members worldwide, including executives from every Fortune 500 company, LinkedIn is the world’s largest professional network on the Internet. The company has a diversified business model with revenues coming from member subscriptions, marketing solutions and hiring solutions. Headquartered in Silicon Valley, LinkedIn has offices across the globe.
A brief about Revenue Model for LinkedIn
The company reported the solid performance for the first quarter ended March 31, 2012, Revenue for the first quarter was $188.5 million, an increase of 101% compared to $93.9 million in the first quarter of 2011. The company has its expected revenue range to $880 million to $900 million. It has basically three area of exposure i.e. Hiring Solutions, Marketing Solutions and Premium Subscriptions.
Hiring Solutions 54%
Revenue from Hiring Solutions products totaled $102.6 million, an increase of 121% compared to the first quarter of 2011. Hiring Solutions revenue represented 54% of total revenue in the first quarter of 2012, compared to 49% in the first quarter of 2011.
Marketing Solutions – 26%
Revenue from Marketing Solutions products totaled $48.0 million, an increase of 73% compared to the first quarter of 2011. Marketing Solutions revenue represented 26% of total revenue in the first quarter of 2012, compared to 30% in the first quarter of 2011.
Premium Subscriptions 20%
Revenue from Premium Subscriptions products totaled $37.9 million, an increase of 91% compared to the first quarter of 2011. Premium Subscriptions represented 20% of total revenue in the first quarter of 2012, compared to 21% of revenue in the first quarter of 2011.
Founded in 2006, Slideshare is a leading professional content sharing community. Professionals can upload content for free, discover people through content, and content through people. Slideshare brings presentations, documents and videos to life on the web for professionals to discover and share. Premium social content marketing subscriptions enable professionals and brands to gain social media engagement and generate sales leads. The company is based in San Francisco, Calif., and is backed by investors including Jonathan Abrams, Mark Cuban, Dave McClure, and Venrock. It has also partnership with Twitter, Google Hangouts and FreeConference.com.
Its revenue model includes premium subscription with Slideshare PRO option, advertising and marketing, through branding and lead generation (The services are called AdShare and LeadShare. Using LeadShare, companies can get upload their various marketing material, and Slideshare will get somewhere between $1 to $22 for each lead generated. Using AdShare, a user can promote their presentations throughout the site.) Slideshare’s biggest competitors include Scribd.com, Issuu and Docstoc.
Value Creation for LinkedIn and its Users
New way to explore connection (discover people through content, and content through people) and user interactivity (LinkedIn)
Through the integration with Slideshare, the user can put some more stuff such as Project Reports, Presentations, books etc. It can also add the value of the profile of the user. (LinkedIn Users)
Increase the number of monthly unique visitors which can impact directly to the advertising and marketing revenue. (LinkedIn)
In addition to ad sales, LinkedIn can also explore the opportunity in lead generation business model of Slideshare.
Key Facts: LinkedIn Slideshare
Members 161 Million 60 Million
Monthly Unique Visitors 107 Million 29 Million
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. This is my independent article.