Ning’s Sale Shows Third Time Is Not the Charm for Marc Andreessen

Marc Andreessen was great at browsers, but when it came to social networks, he was no Mark Zuckerberg.

The Netscape founder-turned VC has sold Ning, the social networking company he co-founded, to Glam Media at a price that is reportedly about 20% of what the company was valued at just three years ago.

Andreessen’s prior two startups were sold for billions. AOL bought Netscape in 1999 for $4.2 billion, while LoudCloud (later renamed Opsware) went public in 2001 and was later bought by Hewlett Packard for about $1.6 billion in 2007.

The big idea behind Ning was to let people create their own social networks based on whatever topics they choose. Apparently, more people were satisfied with just one social network, like Facebook, where Andreessen is a board member.

Ning’s sales price was undisclosed, but Bloomberg BusinessWeek reports that it sold for $150 million, citing two sources familiar with the deal.

That’s a far cry from the $730.15 million post-money valuation assigned to Ning in July 2009 when Lightspeed Venture Partners invested $15 million in the company, according to Thomson Reuters (publisher of this blog).

Overall, Ning raised a total of $126.8 million over three rounds. In its first round in July 2007, Ning raised $48.63 million at a post-money valuation of $223.59 from T. Rowe Price, Legg Mason Wood Walker and an undisclosed investor; it then raised $63.16 million at a post-money valuation of $572.86 million from Legg Mason in April 2008, according to Thomson Reuters.

On his blog, Andreessen put a happy face on the deal, characterizing it as a “merger” instead of as a sale.

Chairman of Ning, Andreessen co-founded the company in 2004 with Gina Bianchini, who was CEO. Bianchini stepped down from the top job in March 2010 and became an executive in residence at Andreessen’s venture firm, Andreessen Horowitz. She was replaced by Ning COO Jason Rosenthal.

As part of the sale, Andreessen is joining Glam’s board, which includes Theresia Gouw Ranzetta of Accel Partners and Tim Draper of Draper Fisher Jurvetson. In a press release, Glam said the acquisition would create one of the world’s largest “social media content companies,” with more than 240 million users and 100,000 publishers.

Glam, which owns and operates lifestyle websites for women, has raised about $147 million in venture capital since its founding in 2002. Besides Accel and DFJ, its backers include Aeris Capital, Burda Digital Ventures GmbH, DAG Ventures, Hercules Technology Growth Capital, Mizuho Capital and Walden Venture Capital, according to Thomson Reuters.