Contact: Brenon Daly
In its largest-ever acquisition, LinkedIn said Thursday afternoon that it will pay $119m for SlideShare in an effort to draw more people to the professional network and keep them there longer. SlideShare has some 29 million unique monthly visitors, and the combination should allow LinkedIn members to expand their professional development and identity. It also significantly increases the amount of content on LinkedIn’s network, which is crucial for the company to grow beyond a site that the 160 million registered users only access when they are looking for a job.
The purchase, which continues the company’s practice to cover its M&A bill with a mix of cash and stock, represents a significant inorganic move to bump up engagement on top of LinkedIn’s earlier in-house efforts such as forming professional groups and a dedicated news page. To date, LinkedIn has had success with its strategy.
As it announced the SlideShare acquisition, LinkedIn also reported financial results for its first quarter. Sales for the January-March period doubled to $189m, with the business running at a solid 20% ‘adjusted EBITDA’ margin. Perhaps more importantly, revenue from all three segments of its business (hiring, marketing, subscriptions) posted strong growth. It’s fairly rare that a fast-growth business (LinkedIn has at least doubled revenue for seven straight quarters now) can put up consistent results across completely different business units without a misstep.
Wall Street has certainly noticed that performance. Shares hit their highest level since last May’s IPO, changing hands at about $120 each in Friday afternoon trading. That values the company at $12.3bn, or more than 13 times the forecasted revenue of roughly $900m for 2012. In comparison, old-line job board Monster Worldwide is valued at only $950m, despite being on track to generate slightly higher revenue this year.
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