PARIS (Reuters) - Viadeo, the world’s second-biggest online networking site for professionals after LinkedIn Corp LNKD.N, is not worried that Facebook Inc’s (FB.O) tough stock market debut will dent social media valuations and is planning going public in about two years.
Facebook’s messy IPO, marred by technical issues and over- ambitious pricing, has dampened investor appetite for Internet stocks, but Viadeo’s strategy chief Olivier Fecherolle said the impact on professional networks had been limited.
“I think the fact that LinkedIn’s valuation held up after the Facebook IPO is a sign that investors can tell the difference between these companies,” Fecherolle told the Reuters Global Media and Technology Summit in Paris on Wednesday.
“Professional social networks are well valued because it’s a more classical business and demand is more stable,” he said.
LinkedIn’s shares are up 1.5 percent since the company’s IPO last year, while Facebook’s are down 28 percent since its mid-May listing.
Paris-headquartered Viadeo, which targets professionals, job seekers and recruiters, has more than 45 million users and is seeking to position itself as the more international cousin of U.S.-based LinkedIn, which has 160 million users.
Viadeo’s users come mainly from Europe, China, India and Latin America.
The company shelved plans for an initial public offering in May 2011 to focus on growth in emerging markets and improving its profitability. In April it raised $32 million from a group of investors in one of the largest European Internet investments in recent years.
“It was our last (funding) round before a possible IPO,” said Fecherolle. “We will use this money to accelerate the geographies we are targeting such as China and need time to execute (the plan) before coming back to potential investors.”
An IPO could be planned for around two years’ time, depending on market conditions and Viadeo’s development, with the company most likely to choose between France and the United States for a stock exchange to list on, Fecherolle said.
Fecherolle said the company is focusing on expanding its clientele in markets like China, where it has 10.5 million members, before it starts to offer paid subscriptions - its main revenue source globally on these markets.
Both LinkedIn and Viadeo have business models that focus on free initial access for users to post their resumes, followed by paid access for premium users. The sites also sell advertisements and recruitment services.
Fecherolle said the company’s latest expansion to Russian market, in partnership with Finnish media group Sanoma (SAA1V.HE), was on track to reach 1 million clients by the end of the year.
Editing by David Holmes