LinkedIn buys start-up for US$90m

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LinkedIn has seen its share price quadruple since May 2011.

Published: 12:00am, 13 Apr 2013Updated: 4:51am, 13 Apr 2013

LinkedIn, the biggest online professional-networking service, is buying start-up Pulse for about US$90 million, accelerating the company's expansion into distributing content for users.

It is paying about 90 per cent in stock and 10 per cent in cash for the application, which is owned by Alphonso Labs.

Founded in 2010 by Akshay Kothari and Ankit Gupta when they were students at Stanford University, Pulse helps users access news and information on mobile phones.

Chief executive Jeff Weiner is using acquisitions and new products to make LinkedIn more relevant to the people already using the site to seek jobs, scout talent and forge professional networks.

"Content appears to be a more effective way of boosting engagement on LinkedIn.com than professional-user groups have been," said Randle Reece, an analyst at Avondale Partners. "Grabbing an early position in the mobile market would be very valuable, long term, as new devices become the mainstream way to access digital content."

LinkedIn has been the favoured stock of all the social-media companies to go public in the past two years. While Facebook, Zynga and Groupon have tumbled, LinkedIn shares have gained 57 per cent this year and have quadrupled since their debut in May 2011.