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Ning, the “make your own social network” tool, has come down from its Web 2.0-bubble high, when it managed to raise money at a mind-boggling $750 million valuation.
But after dumping all of its freeloaders (and many employees) in 2010 and focusing solely on paying subscribers, Ning is slowly but surely starting to build a business.
Ning CEO Jason Rosenthal tells us that the company had 80,000 paying subscribers at the end of 2010, and is planning on finishing 2011 with more than 100,000 sites. (He says January had a 30% surge in customer acquisition over December, too.)
Rosenthal says that monthly revenue per user is roughly around $25 — “right in the middle” of its subscription rates, which range from $3 per month to $50 per month.
So, right now, that puts Ning’s subscription revenue around $2 million per month, or almost $25 million per year. If Ning can reach 100,000 paying subscribers at the same monthly revenue per user, it will be on a $30 million annual run rate. Not bad.
How does that compare to the “old” Ning, which boasted more than 1 million social networks?
In April, 2009, we guesstimated that Ning was on a roughly $10 million annual revenue run rate, mostly via add-on subscription features. Then, Ning cofounder/CEO Gina Bianchini had told us that Ning had 12,000 paying subscribers, spending an average $55 per month on pro features, plus some ad revenue.
So it sounds like Ning’s decision to get rid of its free “customers” and focus on paying subscribers is paying off.
And Rosenthal is eyeing a huge potential market for growth: Not just people and companies who want their own social networks, but basically anyone who is paying a web host today. That’s millions of possible customers for Ning.
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