LinkedIn IPO: 2 Hours, $8 Billion!

LinkedIn generates around $8 billion in no time ... but is everyone really thinking about someone else?

Nobody expected anything less than a shot to the sky from LinkedIn. The business-focused social media company went public on the New York Stock Exchange this morning, a few blocks from where I sit now. In its first two hours on the NYSE, its value has almost doubled, according to MarketWatch, from its initial price of $45. This means that LinkedIn’s market valuation is approaching $8 bn … a far cry from pre-IPO implied valuations of around $2 bn (e.g., on SharesPost) earlier this year.

I’ve written in the past that LinkedIn would likely be a smart “first” for the social media sector. It may not have commanded the excitement of Facebook or Twitter – and it has only 1/6 the user base of the former and half the latter – but LinkedIn’s business is smarter. The company has had multiple revenue streams for several years. It has posted solid user growth over time, and it has adapted to address competitive pressures from Twitter and Facebook (e.g., status updates).

The fact that the least-hyped of the big three took the podium at the NYSE first was exactly what the industry needed. An all-excitement IPO without the numbers to back it up may have led to a fast increase in valuation out of the gate, but that could trigger skepticism or unrealistic expectations for investors (and social media companies) in the near future.

That’s not to say there isn’t a lot of hype around Wall Street right now. You don’t see a company double in value in two hours without a taste of thrill.

Of course, the action on the floor has broader implications, and doubtless there are many social media sector spectators who are thinking about the two companies that are still privately held: Facebook and Twitter. The former, of course, has a private-market-implied valuation of around $80 bn, close to three times that of LinkedIn before the IPO. While watching LinkedIn today, many will be thinking about Facebook … and whether a 12-figure valuation is possible.

Today, however, is LinkedIn’s day. It’s hard to say when (or even if) the growth will slow down, as investors eager for returns and a piece of social media history transact in the newly issued stock. Employees past and present will finally see their hard work and salary sacrifices come to fruition today, and risk-taking and entrepreneurship will be feted, as they should be.

Nonetheless, there will be a “plus one” in everybody’s LinkedIn thoughts today. Given the excitement on the floor and the Street, it’s hard not to imagine how Facebook’s run at an IPO will go.

Advice: The LinkedIn folks at the NYSE today should be sure to get their hands on the sliders served at the Exchange. I munched on them went I went to the closing bell for the IR Magazine US Awards, and I’m dying to sink my teeth into them again! These really are the most incredible burgers you will find in New York, and you have to get into this exclusive environment to sample them.