LinkedIn Love

Updated after jump Lots of speculation that LinkedIn has raised a bunch of new VC funding at a valuation of approximately $1 billion (see here, here and here).
No investor info yet, although it’s safe to assume that at least one non-traditional investor (hedge fund, bank) will participate. May be more interesting to see which existing VCs re-up, since neither Sequoia nor Greylock participated in the company’s $12.8 million Series C round early last year ($250m post-money, from Bessemer and European Founders Fund).

I’ve got calls in for some details, but in the meantime was thinking about how far this company has come in terms of investor acceptance. I remember having dinner four years ago with a group of VCs and Eric Ly, a LinkedIn co-founder who currently runs appointment appliance Presdo. Ly asked if any of us used LinkedIn, and our collective reply was that we’d gotten dozens – if not hundreds – of invites, but had never accepted any of them. Seemed like a waste of time, and felt like spam.

Ly argued his company’s case, and asked that we at least give it a trial run. All we had to lose was a few minutes of setup time, and we could always go back to ignoring incoming requests.

I took Ly up on his challenge the following week, although violated the spirit of LinkedIn by telling readers that I would accept any and all invitations (a policy I’ve maintained to this day). Four years later, I have over 1,300 contacts and use the service regularly to find sources (particularly at investment banks or other large institutions). It’s one of the best tools a journalist could have.

My network also includes at least three members of that dinner table, and each of them has over 100 contacts. That’s a pretty good adoption turnaround. Not sure if it’s worth $1 billion, but it’s sure worth a lot more than a lot of its trendier competitors.

Update: There also have been reports that LinkedIn may be on the block, but at least one obvious acquirer has not yet gotten a call or book from LinkedIn’s bankers at Allen & Co. In other words, private placement seems much more likely than acquisition.

Update II: Hearing that LinkedIn is looking to raise $100 million, which would be used to fund acquisitions. Also may have first gone out with a $1.5 billion valuation hope, but is now “down” at $1 billion.