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Summary:

Looks like the departure exactly a month ago of long-time Ning CEO Gina Bianchini was not as benign as Ning tried to portray it. The build-y…

Fast Company

Looks like the departure exactly a month ago of long-time Ning CEO Gina Bianchini was not as benign as Ning tried to portray it. The build-your-own social network startup is laying off 40 percent of its staff, or 69 employees, and is moving to an entirely paid model. In a note to employees, new CEO Jason Rosenthal says he’s taken a “hard look at our business” and determined that “we need to double down on our premium services business.” Rosenthal says Ning’s “premium” networks drive the majority of its traffic and “will pay for many more services and features from us.” Existing free networks built on Ning can quit the service or pay up.

Rosenthal’s letter provides quite the contrast to Ning Chairman Marc Andreeseen’s statement when Bianchini left. At the time, he said “nothing else is changing” and noted Bianchini’s “amazing series of accomplishments in her time as CEO.”

This is a huge comedown for a company that was famously featured in Fast Company, talking about how it would get “billions” of page views and therefore attract a “nice slice” of the then rapidly growing online ad market. As recently as a year ago, when the company raised $15 million at an incredible $750 million valuation, the dream was apparently still living on.

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  1. a lot of us have been skeptical about this grenade since day one and this, along with the FIRING of their CEO last month, only proves the case that something bad is happening to this business.

  2. As I mentioned on the TC post about this, we’ve actually had a lot (well a few thousand) regular Ning users sign up for our customized newspapers in the last two months. I’d definately suggest going with some of the full whitelabel social network platforms (Kickapps etc) if you need a full social network.

    However, if you are more interested in the news side – i.e. having a community around news/current events and want a simple community site focused on your editorials (plus a ton of automatically aggregated content) – give NewsCred a try!

    Either way, I hope that both Ning employees and the kicked out free users land on their feet!

  3. Seems like the only logical conclusion one can draw from this article is Fast Company is nothing more than a hype machine for Silicon Valley elitists….

    But most of us already knew that…

  4. Hasn’t anybody in media figured out the story yet? Allen & Company, despite their stellar reputation, is a scam shop. They have repeatedly duped investors (both corporate and financial) by sprinkling their illusive “pixie dust” on client firms to pump their valuations until they later crash and burn. And crash and burn they do. Ning, Bebo, PlanetOut, Slide, SpotRunner, Heavy, Glam (not yet but stand by) and several other clients have been a major “pump and dump” for the buyers/investors. In financings, it really doesn’t help the issuer to achieve an outsized valuation – all that happens is the cap table is screwed and the company has no future. So a word to the wise: if you buy the Allen & Co. mystique crap, you had better be selling all your equity for cash. As for the other side: caveat emptor. I should know – I worked there.

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