Yang Resignation `Positive' for Yahoo Stock

Zynga IPO Outlook July 7 (Bloomberg) -- Michael Yoshikami, chief investment strategist at

July 7 (Bloomberg) -- Michael Yoshikami, chief investment strategist at YCMNet Advisors, Bob Rice, general managing partner at Tangent Capital Partners LLC, Paul Martino, managing director at Bullpen Capital, and Paul Bard, director of research at Renaissance Capital LLC, talk about Zynga Inc.'s plan to raise $1 billion in an initial public offering and the outlook for the company. (Excerpts. Source: Bloomberg)

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LinkedIn Stock Rockets After IPO

May 20, 2011, 5:21 PM EDT By Ari Levy and Lee Spears

(Updates with closing shares in the second paragraph.)

May 20 (Bloomberg) -- LinkedIn Corp. held most of its gains after more than doubling yesterday in its debut, leaving investors in the first initial public offering of a major U.S. social-media site with a 107 percent gain.

The shares climbed as much as 14 percent before a late retreat left them down 1.2 percent for the day at $93.09 on the on the New York Stock Exchange. The stock, traded under the ticker LNKD, surged 109 percent to $94.25 yesterday.

after surging 109 percent yesterday. The ticker is LNKD.

Based on today’s closing price, LinkedIn’s market value is $8.8 billion, or about 23 times 2011 revenue, assuming first- quarter sales are matched the rest of the year. Facebook Inc., the world’s largest social network, would be valued at about $94 billion using the same multiple. The gains bode well for Internet companies that have put off going public while honing efforts to make money, and they may brighten prospects for the venture capital industry, which lost money amid an IPO drought.

“We knew this was going to be a super hot IPO and gives us further evidence of the enormous appetite for this wave of next- generation Internet companies,” Paul Bard, director of research at Renaissance Capital LLC, said in an interview with Bloomberg Television. “You are going to see more companies go public that will try to capitalize on this wave of interest.”

LinkedIn’s debut reflects comeback potential for IPOs for startups funded by venture capitalists. U.S. venture-backed companies raised $1.38 billion in IPOs in the first quarter, a 47 percent increase from a year earlier, according to the National Venture Capital Association. In the first quarter of 2009 there were no venture-backed IPOs.

Overvalued

There’s mounting concern that some technology shares may be overvalued as investors shake off their apprehension from the 2007-2009 collapse of the credit markets, former U.S. Treasury Secretary Lawrence Summers said at a conference today in Shanghai.

“Who could have imagined that the concern with respect to any American financial asset, just two years after the crisis, would be a bubble?” Summers, now a professor at Harvard University, said at a conference today in Shanghai. “Yet that concern is increasingly raised with respect to American technology, with respect to certain other American assets.”

LinkedIn may not be able to sustain the market value gained yesterday, said Dan Veru, chief investment officer at Fort Lee, New Jersey-based Palisade Capital Management LLC, which oversees $3.8 billion and bought LinkedIn in the IPO.

‘Exceeded Expectations’

“At $100 a share, we would not be buyers,” Veru said. “It far exceeded our expectations for what it would do in the first day of trading. It would be amazing to me, with the revenue base it has, if it maintains a $10 billion market cap.”

LinkedIn’s performance yesterday is reminiscent of some of hottest stocks in the dot-com boom. Yahoo! Inc. rose 154 percent on its first trading day in 1996, a year after Netscape Communications Corp. more than doubled in its debut.

More recently, Google Inc. rose 18 percent in its 2004 IPO, and VMware Inc. surged 76 percent when it started trading in 2007.

“The valuation for LinkedIn is rich,” said Michael Moe, chief investment officer of GSV Capital Management in Woodside, California, in a televised interview with “Bloomberg West.” “To earn the valuation, it has to continue to grow very, very fast.”

Qihoo 360 Technology Co., the Beijing-based provider of computer anti-virus products and Web browsers, had the biggest first-day gain among U.S. IPOs this year, surging 134 percent after raising $175.6 million in its offering.

Backers Gain

LinkedIn’s backers, which have made more than $100 million in investments in Mountain View, California-based LinkedIn since 2003, stand to gain. Sequoia Capital has amassed a holding now worth $1.59 billion, and Greylock Partners has a $1.32 billion stake, based on yesterday’s close. Reid Hoffman, LinkedIn’s founder and chairman and its biggest shareholder, holds $1.8 billion and Bessemer Venture Partners has a stake worth $431.5 million.

Members of LinkedIn use the site to search for jobs, recruit employees and find industry experts. While users can create personal profiles for free, paid subscriptions were introduced in 2005, giving recruiters more access to candidates and providing professionals ways to communicate with one another.

While LinkedIn is often compared to social networks such as Facebook and Twitter Inc., which depend on advertising to consumers, the company said in its prospectus that a “substantial portion” of revenue comes from a business that’s comparable to the software-as-a-service model. That’s where companies deliver software over the Internet, a market expected to climb 16 percent this year to $10.7 billion, according to Gartner Inc., a research firm in Stamford, Connecticut.

Business Software

SaaS companies, including Salesforce.com Inc., NetSuite Inc. and SuccessFactors Inc., sell subscriptions over the Internet rather than long-term licenses like traditional business-software companies.

LinkedIn’s hiring solutions business, targeted at recruiters, accounted for about half of LinkedIn’s $93.9 million in first-quarter revenue, with 30 percent coming from ads. LinkedIn’s net income rose 14 percent to $2.08 million in the first quarter as sales more than doubled.

LinkedIn sold 7.84 million shares at $45 each this week. The company raised the proposed price range for its initial offering on May 17, to $42 to $45 a share, from $32 to $35. The sale raised $352.8 million.

Proceeds from the offering will be used to fund existing operations and expand the business, including possibly buying other companies or technologies, LinkedIn said in a filing with the U.S. Securities and Exchange Commission. Including an overallotment option for underwriters to buy an additional 1.18 million shares, LinkedIn may raise as much as $405.7 million.

Morgan Stanley

Morgan Stanley, Bank of America Corp. and JPMorgan Chase & Co. led the offering.

About 62 percent of the shares in the offering were being sold by LinkedIn, according to the prospectus. Other sellers include a venture capital affiliate of Bain Capital LLC, McGraw- Hill Cos., Goldman Sachs Group Inc. and founder and Chairman Reid Hoffman.

Venture capital backers Sequoia Capital, Greylock Partners and Bessemer Venture Partners aren’t selling shares, according to the filing.

--With assistance from Brian Womack in San Francisco, Lisa Murphy in New York and Zhang Dingmin in Beijing. Editors: Lisa Rapaport, Tom Giles

To contact the reporters on this story: Lee Spears in New York at lspears3@bloomberg.net; Ari Levy in San Francisco at alevy5@bloomberg.net;

To contact the editors responsible for this story: Jennifer Sondag at jsondag@bloomberg.net Tom Giles at tgiles5@bloomberg.net

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LinkedIn Stock Rockets After IPO

May 20, 2011, 11:43 AM EDT By Ari Levy and Lee Spears

May 20 (Bloomberg) -- LinkedIn Corp. soared on its second trading day, after more than doubling yesterday in a show of strong demand for social-media stock and a comeback in venture- capital backed initial public offerings.

LinkedIn, the largest professional-networking website, rose as much as 14 percent to $107 on the New York Stock Exchange, adding to a 109 percent surge yesterday. The ticker is LNKD.

LinkedIn’s market value at its peak price today is $10.1 billion, or about 26.9 times 2011 revenue, assuming first- quarter sales are matched the rest of the year. Facebook Inc., the world’s largest social network, would be valued at about $107.6 billion using the same multiple. The gains bode well for Internet companies that have put off going public while honing efforts to make money, and they may brighten prospects for the venture capital industry, which lost money amid an IPO drought.

“We knew this was going to be a super hot IPO and gives us further evidence of the enormous appetite for this wave of next- generation Internet companies,” Paul Bard, director of research at Renaissance Capital LLC, said in an interview with Bloomberg Television. “You are going to see more companies go public that will try to capitalize on this wave of interest.”

LinkedIn’s debut reflects a comeback in IPOs for startups funded by venture capitalists. U.S. venture-backed companies raised $1.38 billion in IPOs in the first quarter, a 47 percent increase from a year earlier, according to the National Venture Capital Association. In the first quarter of 2009 there were no venture-backed IPOs.

Overvalued

There’s mounting concern that some technology shares may be overvalued as investors shake off their apprehension from the 2007-2009 collapse of the credit markets, former U.S. Treasury Secretary Lawrence Summers said at a conference in today in Shanghai.

“Who could have imagined that the concern with respect to any American financial asset, just two years after the crisis, would be a bubble?” Summers, now a professor at Harvard University, said at a conference today in Shanghai. “Yet that concern is increasingly raised with respect to American technology, with respect to certain other American assets.”

LinkedIn may not be able to sustain the market value gained yesterday, said Dan Veru, chief investment officer at Fort Lee, New Jersey-based Palisade Capital Management LLC, which oversees $3.8 billion and bought LinkedIn in the IPO.

‘Exceeded Expectations’

“At $100 a share, we would not be buyers,” Veru said. “It far exceeded our expectations for what it would do in the first day of trading. It would be amazing to me, with the revenue base it has, if it maintains a $10 billion market cap.”

LinkedIn’s performance is reminiscent of some of hottest stocks in the dot-com boom. Yahoo! Inc. rose 154 percent on its first trading day in 1996, a year after Netscape Communications Corp. more than doubled in its debut.

More recently, Google Inc. rose 18 percent in its 2004 IPO, and VMware Inc. surged 76 percent when it started trading in 2007.

“The valuation for LinkedIn is rich,” said Michael Moe, chief investment officer of GSV Capital Management in Woodside, California, in a televised interview with Bloomberg West. “To earn the valuation, it has to continue to grow very, very fast.”

Qihoo 360 Technology Co., the Beijing-based provider of computer anti-virus products and Web browsers, had the biggest first-day gain among U.S. IPOs this year, surging 134 percent the day after raising $175.6 million in its offering.

Backers Gain

LinkedIn’s backers, which have made more than $100 million in investments in Mountain View, California-based LinkedIn since 2003, stand to gain. Sequoia Capital has amassed a holding now worth $1.59 billion, and Greylock Partners has a $1.32 billion stake, based on yesterday’s close. Hoffman, LinkedIn’s founder and chairman and its biggest shareholder, holds $1.8 billion and Bessemer Venture Partners has a stake worth $431.5 million.

Members of LinkedIn use the site to search for jobs, recruit employees and find industry experts. While users can create personal profiles for free, paid subscriptions were introduced in 2005, giving recruiters more access to candidates and providing professionals ways to communicate with one another.

While LinkedIn is often compared with social networks such as Facebook and Twitter Inc., which depend on advertising to consumers, the company said in its prospectus that a “substantial portion” of revenue comes from a business that’s comparable to the software-as-a-service model. That’s where companies deliver software over the Internet, a market expected to climb 16 percent this year to $10.7 billion, according to Gartner Inc., a research firm in Stamford, Connecticut.

Business Software

SaaS companies, including Salesforce.com Inc., NetSuite Inc. and SuccessFactors Inc., sell subscriptions over the Internet rather than long-term licenses like traditional business-software companies.

LinkedIn’s hiring solutions business, targeted at recruiters, accounted for about half of LinkedIn’s $93.9 million in first-quarter revenue, with 30 percent coming from ads. LinkedIn’s net income rose 14 percent to $2.08 million in the first quarter as sales more than doubled.

LinkedIn sold 7.84 million shares at $45 each this week. The company raised the proposed price range for its initial offering on May 17, to $42 to $45 a share, from $32 to $35. The sale raised $352.8 million.

Proceeds from the offering will be used to fund existing operations and expand the business, including possibly buying other companies or technologies, LinkedIn said in a filing with the U.S. Securities and Exchange Commission. Including an overallotment option for underwriters to buy an additional 1.18 million shares, LinkedIn may raise as much as $405.7 million.

Morgan Stanley

Morgan Stanley, Bank of America Corp. and JPMorgan Chase & Co. led the offering.

About 62 percent of the shares in the offering were being sold by LinkedIn, according to the prospectus. Other sellers include a venture capital affiliate of Bain Capital LLC, McGraw- Hill Cos., Goldman Sachs Group Inc. and founder and Chairman Reid Hoffman.

Venture capital backers Sequoia Capital, Greylock Partners and Bessemer Venture Partners aren’t selling shares, according to the filing.

--With assistance from Brian Womack in San Francisco, Lisa Murphy in New York and Zhang Dingmin in Beijing. Editors: Lisa Rapaport, Tom Giles

To contact the reporters on this story: Lee Spears in New York at lspears3@bloomberg.net; Ari Levy in San Francisco at alevy5@bloomberg.net;

To contact the editors responsible for this story: Jennifer Sondag at jsondag@bloomberg.net Tom Giles at tgiles5@bloomberg.net

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China Mobile’s Wang Is ‘Very Confident’ Even as Stock Falls

May 19, 2011, 5:04 AM EDT By Bloomberg News

(Updates with closing share prices starting first paragraph.)

May 19 (Bloomberg) -- China Mobile Ltd. Chairman Wang Jianzhou said he’s “very confident” about the carrier’s prospects as an investor questioned the merits of holding the stock after it fell 12 percent in the past six months.

China Mobile adds about 5 million subscribers a month and has more room to grow as it shifts to a more advanced network next year, Wang said at an annual shareholders meeting in Hong Kong today. The company, the world’s largest wireless carrier by customers, is also considering acquisitions in Asia, he said.

The stock’s decline is worse than the 1.9 percent drop for Hong Kong’s Hang Seng Index in the same period. China Mobile said in March it will invest as much as 132.4 billion yuan ($20 billion) on its current third-generation network and add wireless hotspots to attract higher-spending customers to download music and games, after expanding its user base by luring customers in China’s rural areas who spend less.

“The share price is comparatively low, and our management team is concerned about that and how to realize full value,” Wang said in response to a shareholder’s question about the stock’s decline. “Management is still very confident in the outlook.”

The Hong Kong-based operator will look at opportunities to buy companies in Asia, he said. Its parent has a unit in Pakistan that may break even next year, and China Mobile may buy over the unit “at any time,” Wang said.

China Mobile lost 0.3 percent to close at HK$69.00 in Hong Kong trading, and the Hang Seng Index added 0.7 percent.

Surpassing 600 Million

The carrier became the world’s first phone company to exceed 600 million subscribers in the first quarter, driven by additions of customers in the countryside. China Unicom (Hong Kong) Ltd., the nation’s second-biggest mobile-phone company with 320.9 million subscribers, has 18.5 million 3G users, trailing the larger rival’s 27 million.

China Mobile aims to maintain its lead with heavy-data users by introducing the country’s first fourth-generation network using the Chinese-developed TD-LTE technology next year, Wang said. It received government approval in December to begin a trial in seven major cities including Beijing, Shanghai and Shenzhen, he said.

The company may also be able to offer Apple Inc.’s iPhone with the shift to TD-LTE, Wang said. While Apple has decided not to make a version of the phone for the third-generation TD-SCDMA system that is used only by China Mobile, the Cupertino, California-based company may produce one for the TD-LTE system, he said.

Carolyn Wu, an Apple spokeswoman in Beijing, declined to comment.

Wireless Attraction

Even without an iPhone that works on its 3G network, China Mobile has been able to attract 4 million users of the popular handset with its wireless hotspots, Wang said. The company intends to have as many as 1 million hotspots, Chief Executive Officer Li Yue said, without giving a timeframe.

IPhone users make greater use of data and downloads than the average subscriber, Wang said, without providing figures.

China Mobile said last month that 549 million customers used value-added data services on their phones in the first quarter, and 476 million accessed its wireless music service. Value-added services were the “driving force” of sales growth in the first quarter, the company said.

First-quarter net income climbed 5.4 percent from a year earlier to 26.9 billion yuan, and sales rose 8.3 percent to 118.2 billion yuan, the company said April 20.

--Edmond Lococo, Editors: Lena Lee, Chua Kong Ho

To contact Bloomberg News staff for this story: Edmond Lococo in Beijing at elococo@bloomberg.net

To contact the editor responsible for this story: Young-Sam Cho at ycho2@bloomberg.net

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