Pinterest Inc. said it raised $225 million in a financing round that values it at $3.8 billion, as the Internet-scrapbooking startup seeks to expand and develop a model for generating revenue.
The San Francisco-based company said the funding was led by mutual-fund firm Fidelity Investments, a new investor, with participation from existing investors such as Bessemer Venture Partners and FirstMark Capital. The round brings Pinterest’s total funding to $565 million and boosts its valuation from $2.5 billion during a February financing round.
“We hope to be a service that everyone uses to inspire their future,” Pinterest Chief Executive Officer Ben Silbermann said in a statement. “This new investment enables us to pursue that goal even more aggressively.”
Pinterest remains near the forefront of a pack of fast- growing Silicon Valley startups that also includes online- storage startup Dropbox Inc., among others. Pinterest has racked up funding as it rides a surge of user growth, even as it is still testing advertising and ways to make money. The site, which is free for consumers, lets people share images of objects or projects by “pinning” pictures online.
The financing comes amid renewed investor appetite for Internet companies, with microblogging service Twitter Inc. preparing to go public. Confidence among Silicon Valley’s venture capitalists rose to a six-year high in the third quarter, with more opportunities and a better environment for public offerings, according to a September survey conducted by Mark Cannice, a professor at the University of San Francisco School of Management.
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At the new valuation, Pinterest is now worth more than publicly traded Internet companies Zynga Inc. and Angie’s List Inc.
Vince Loporchio, a spokesman for Fidelity, declined to comment.
Pinterest said it plans to use the new capital to expand internationally. The startup recently rolled out sites in the U.K., Italy and France, and is planning to start its service in 10 more countries this year,
In addition, Pinterest said it is working on investing in its mobile service, testing its advertising and revenue model, and spending on technical infrastructure. The company also said it may use the money on “strategic acquisitions of both talent and technology.”
The investment was reported earlier by technology blog AllThingsD.
With assistance from Christopher Condon in Boston. Editors: Pui-Wing Tam, Jillian Ward. To contact the reporter on this story: Pui-Wing Tam in San Francisco at [email protected] To contact the editor responsible for this story: Pui-Wing Tam at [email protected]