Pinterest, the scrapbooking site and latest social media darling, is now valued at about $5 billion, based on its latest round of financing from investors.
The San Francisco company said on Thursday that it raised $200 million, which values the entire company at about $5 billion, making it one of the most valuable venture-capital backed startups in the world, The Wall Street Journal reported.
The 4-year-old San Francisco company's value is soaring in the eyes of venture capitalist despite little yet in the way of revenue. Pinterest, which launched in 2010, lets users build online collections of photos. The company said it has notched more than 30 billion pins. Despite little in the way of revenue so far, venture capitalist are willing to make lofty bets on the company's high growth potential. And, the ups-and-downs of the stock market that has reduced the value of several tech companies hasn't suppressed their appetite for deals.
This means that Pinterest, which recently began selling its first ads to companies including General Mills Inc. (NYSE:GIS) and Lululemon Athletica Inc. (NASDAQ: LULU), has been able to raise $764 million from various investor groups, including venture-capital firms Bessemer Venture Partners and Andreessen Horowitz; a hedge fund, Valiant Capital Partners; and Japan's top Internet retailer Rakuten Inc., which competes in online shopping there with Amazon.com Inc. (NASDAQ:AMZN) and Yahoo Inc. (NASDAQ:YHOO).
Pinterest, which has offices in the U.K., France and the U.S., said it will use the new financing to expand its global operations from a current 31 countries.
Thursday's valuation marks a doubling of the company's value in a little over a year. Pinterest's valuation hit $2.5 billion in February 2013.
Pinterest’s expansion ambitions follow in the footsteps of other prominent Internet businesses such as Facebook Inc. (NASDAQ:FB), Groupon Inc. (NASDAQ:GRPN) and Zynga Inc. (NASDAQ:ZNGA), all of which received substantial investment through private fundraising before making initial public offerings.