While investors have been largely focused on Facebook this week, virtual pinboard start-up Pinterest made some news of its own with a capital funding round that raised $100 million and valued the company at $1.5 billion. The round was led by Japan-based e-commerce Goliath Rakuten, with Andreessen Horowitz, Bessemer Venture Partners and FirstMark Capital also participating. A spokesman for Rakuten said that Pinterest is the perfect fit for a partner, and a strong push will be made to expand Pinterest into the Japanese market.
Pinterest began generating a lot of buzz earlier this year, following three years of relative anonymity after its launch, and investor interest has remained high ever since. According to recent report put together by British marketing firm Tamba, a full 20 percent of all Facebook users now use Pinterest daily, and the company's mobile app is on the verge of attaining the 250,000 download plateau. In addition, Pinterest is having greater success in recent months guiding users to other websites, having surpassed mighty Twitter in terms of percentage of users that follow referrals to other sites.
In the current quarter, according to the Tamba study, about 40 percent of all social media initiated purchases originated from Pinterest, and over 40 percent of the start-up's userbase fall within the key demographic of Americans earning between $50,000 and $100,000. With that type of social media pull, and the rapid pace of growth Pinterest is experiencing, it will likely be just a matter of time before the company is forced to begin trading publicly to answer growing interest from investors.