Why Is Pinterest Suddenly Worth $5 Billion?

A blog about business and economics.
May 16 2014 1:36 PM

Pinterest Valuation Soars to $5 Billion on New Funding

pinterest_ipad
Pinterest's valuation is soaring.

Photo from Pinterest

Pinterest is inching ever closer to joining the 11-digit club. The online scrapbooking site is now valued at $5 billion after raising a new $200 million round of funding. That brings its valuation nearer to that of cloud storage service Dropbox and alternative rental site Airbnb.

The new money comes from SV Angel, Bessemer, Venture Partners, Fidelity, Andreessen Horowitz, FirstMark Capital, and Valiant Capital Partners—all existing investors. Six months earlier, Pinterest secured a $225 million funding round that gave it a $3.8 billion valuation. To date, the company has raised $764 million through six rounds of funding.

This past September, Pinterest announced that it would begin to roll advertising into its platform through "promoted pins." Much like a sponsored tweet on Twitter, these posts are paid for by advertisers and flagged as such. Pinterest pledged to keep the promotions tasteful, transparent, and relevant in an effort not to antagonize users.

screen_shot_20140516_at_12.21.15_pm

ShareThis

Advertisement

Pinterest has absolutely stellar sharing metrics. Sharing on Pinterest grew 58 percent in 2013—faster than it did on Facebook, Twitter, or LinkedIn—according to social data platform ShareThis. Pinterest beats out email as the third most popular sharing platform overall, accounts for 48 percent of all sharing on tablets, and as New York's Kevin Roose points out, "drives more Internet traffic to publishers than Twitter and Reddit combined."

Pinterest's user base still skews strongly female (80 percent), and those users are fiercely loyal. A recent analysis found that 84 percent of women who use Pinterest are still active in their fourth year. That's an incredible retention metric. Between that figure and Pinterest's soaring sharing statistics, it's no wonder investors are staking a lot more money on the company.

Alison Griswold is a Slate staff writer covering business and economics.

 

TODAY IN SLATE

The Juice

Ford’s Big Gamble

It’s completely transforming America’s best-selling vehicle.

Should the United States Grant Asylum to Victims of Domestic Violence?

The Apple Watch Will Make Everyone Around You Just a Little Worse Off

This Was the First Object Ever Designed

Don’t Expect Adrian Peterson to Go to Prison

In much of America, beating your kids is perfectly legal. 

Moneybox

How the Apple Watch Will Annoy Us

A glowing screen attached to someone else’s wrist is shinier than all but the blingiest jewels.

Music

A Little Bit Softer Now, a Little Bit Softer Now …

The sad, gradual decline of the fade-out in popular music.

Is Everyone Going to Declare Independence if Scotland Does It? 

I Tried to Write an Honest Profile of One of Bollywood’s Biggest Stars. It Didn’t Go Well.

Trending News Channel
Sept. 12 2014 11:26 AM Identical Twins Aren’t Really Identical
  News & Politics
Politics
Sept. 12 2014 7:24 PM Come and Take It Libertarians fight for people whose property was seized by the police.
  Business
Moneybox
Sept. 12 2014 5:54 PM Olive Garden Has Been Committing a Culinary Crime Against Humanity
  Life
Outward
Sept. 12 2014 3:32 PM Yes, Those Straight Guys Who Wed for Rugby Tickets Are Mocking Marriage. What’s New?
  Double X
The XX Factor
Sept. 12 2014 4:05 PM Life as an NFL Wife: “He's the Star. Keep Him Happy.”
  Slate Plus
Behind the Scenes
Sept. 12 2014 5:55 PM “Do You Know What Porn Is?” Conversations with Dahlia Lithwick’s 11-year-old son.
  Arts
Brow Beat
Sept. 14 2014 7:10 PM Watch Michael Winslow Perform Every Part of “Whole Lotta Love” With Just His Voice
  Technology
Future Tense
Sept. 12 2014 3:53 PM We Need to Pass Legislation on Artificial Intelligence Early and Often
  Health & Science
New Scientist
Sept. 14 2014 8:38 AM Scientific Misconduct Should Be a Crime It’s as bad as fraud or theft, only potentially more dangerous.
  Sports
Sports Nut
Sept. 12 2014 4:36 PM “There’s No Tolerance for That” Pete Carroll and Jim Harbaugh say they don’t abide domestic abuse. So why do the Seahawks and 49ers have a combined six players accused of violence against women?