Please ensure Javascript is enabled for purposes of website accessibility

Investors Like This Social Network Best

By Tim Beyers – Updated Apr 6, 2017 at 1:12AM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Neither Facebook nor Twitter makes the list.

Which is the most popular social network with investors? Facebook? Nope. Twitter? Nuh-uh. MySpace? Sorry, Rupert, but News Corp. (NASDAQ:NWS) lost on that deal.

According to a recent survey by Reuters, LinkedIn is the social network that Silicon Valley's venture capitalists consider most likely to file for an IPO or be acquired. They also like these five start-ups:

  • Solyndra, a maker of solar panels.
  • Silver Spring Networks, which makes and markets smart grid technology.
  • Zynga, which develops games to be played over social networks, including YoVille! and Mafia Wars.
  • Guidewire, a developer of software for the insurance industry.
  • LiveOps, which supplies contact center software and services via cloud computing.

I'm sure these all are good companies. But aren't you at least a little surprised to see Facebook miss this list? The world's largest social network has been publicly practicing its two-step for the IPO ball. In July, the company hired a new Chief Financial Officer. Last week, it acquired FriendFeed to bolster its real-time offerings to users.

Why should LinkedIn rate higher than Facebook, when the latter site's so clearly angling for a heaping helping of the IPO pie that Open Table (NASDAQ:OPEN), Rosetta Stone (NYSE:RST), and Changyou.com (NASDAQ:CYOU) have enjoyed?

I can see two reasons. First, Google (NASDAQ:GOOG), Microsoft (NASDAQ:MSFT), and Yahoo! (NASDAQ:YHOO) have turtled when it comes to speculative social networking investments. LinkedIn leaves fewer reasons for these firms to duck and cover, because the network is 100% focused on business connections, and easier to monetize as a result.

Second, BusinessWeek's Sarah Lacy reports that Facebook's employees are continuing to cash in shares. Not exactly a sign that an IPO is in the works, nor much of a vote of confidence in the overall business plan.

Twitter, meanwhile, keeps getting hacked.

LinkedIn may hold less promise than either Twitter or Facebook, but it's probably the most stable and most predictable. In today's troubled market, investors in public and private issues prize few things more.

Get your clicks with related Foolishness:

Microsoft is an Inside Value pick. Google and Open Table are Rule Breakers recommendations. Try any of our Foolish newsletter services free for 30 days.

Fool contributor Tim Beyers had stock and options positions in Google at the time of publication. Check out Tim's portfolio holdings and Foolish writings, or connect with him on Twitter as @milehighfool. The Motley Fool is also on Twitter as @TheMotleyFool. The Fool's disclosure policy is po'd about the stalled IPO market.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Microsoft Corporation Stock Quote
Microsoft Corporation
MSFT
$237.92 (-1.27%) $-3.06
Alphabet Inc. Stock Quote
Alphabet Inc.
GOOGL
$98.74 (-1.40%) $-1.40
Twenty-First Century Fox, Inc. Stock Quote
Twenty-First Century Fox, Inc.
FOX
OpenTable, Inc. Stock Quote
OpenTable, Inc.
OPEN

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
339%
 
S&P 500 Returns
109%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 09/24/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.