Pinterest’s new round of funding values startup at $5 billion

Pinterest has been slowly slugging along in the rankings with around 100 million active users in 2014. The social board still is not self-sufficient and needs funding. The most recent seed funding happened just a few weeks ago for $200 million, valuing the startup at $5 billion.

This is not the biggest valuation we have seen on a young startup, but the potential income for the service and the fact 80 percent of users are women really makes Pinterest unique from other apps and services that are having a hard time figuring out how to make money.

SV Angel led this round of funding along with funding from Bessemer Venture Partners, Fidelity, A16Z, FirstMark Capital, and Valiant Capital Partners. Rakuten, a previous investor of Pinterest, decided not to fund this round, even though they have been one of Pinterest’s key partners in the past.

The $200 million in funding will go towards Pinterest’s global expansion. Currently the startup has offices France, the UK, and Japan. We are surprised Pinterest does not have offices in Silicon Valley considering this is one of the most popular areas for technology and future tech.

Funding will also go towards monetization, as currently Pinterest cannot work without funding from ventures, but in the near future the company wants to be self-reliant. The first Promoted Pin was shown three days ago and we could see other advertisements and promotions in the near future.

Brands have been working on Pinterest for years now and made incredible sales and customers through the website, yet developers cannot seem to crack how to make money from this.

Unlike Facebook, where a brand would pay Facebook to promote their posts/page for a fee, Pinterest allows brands to do that for free. This means Pinterest needs to make brands pay for special features to reach to a more wider audience.

Fashion and jewelry are big on Pinterest and are popular topics that are high ROIs, meaning Pinterest could make sure its advertisements cost a lot more than the average Google or Facebook ad.

It might be a few years before Pinterest is a powerhouse of advertisement, but if it can stick to its goals, the company will surely make it soon.