XING proves the social networking party is far from over

Amongst all the negative news on the collapse of Web 2.0, the first social network to go public doubles its revenues.

OK, so there is a large number of so-called Web 2.0 companies out there that amount to not much then a kind of neat idea, but certainly not a business. And the turmoil in the financial markets of the past two or so weeks has rightly got people asking questions on whether many of these companies can survive. I have, myself, commented at length on assertions coming out or both Twitter and Facebook that revenue isn't important as it's all about user numbers (I think this is nonsense if you haven't read my views).

But not all Web 2.0 companies should be tarred with the same brush. Many have solid revenue plans and some are even executing on them. XING AG of Germany even has to prove what it is doing after it went public in 2006.

And it's doing just great, thank you. Figures released today for the three quarters of the year so far show revenues nearly doubled, to 25 million Euros to September 2008 compared with 13 million for the same period in 2007.

Further defying the doom-mongers, XING also achieved a 9.47 million profit (EBITDA) on the back of its most profitable quarter for the year so far. Paying subscribers rose to 514,000, 8% of the total base of 6.53 million.

Although far behind LinkedIn's supposed 25 million members, LinkedIn remains a private concern which doesn't disclose financial performance. It is unlikely that the Mountain View, California based rival is achieving the same proportional revenue or profitability figures.

Xing manages an easy second in terms of European business focused networks if seen in terms of user numbers, with France's Viadeo third with around 1.5 million members. The UK's Ecademy has around 170,000 individual profiles, but only 7,500 paying members - just 4% alongside Xing's 8% of total paying membership.

Ian Hendry
CEO, WeCanDo.BIZ
http://www.wecando.biz