Kara Swisher

Recent Posts by Kara Swisher

The Profits Will Come Out Tomorrow? Ning CEO Rosenthal Talks About Premium Changeover

Last week, BoomTown moseyed on down to the Palo Alto, Calif., HQ of Ning–the high-profile social networking platform co-founded by Silicon Valley icon Marc Andreessen–to talk to CEO Jason Rosenthal (pictured here) about a dramatic shift in the start-up’s business plan tomorrow.

As in, go all-premium, trying to find a way to turn the start-up–which has raised $120 million in venture funding since its late 2004 founding–into a profitable enterprise.

Translation for Web 2.0: Profits are when you make more money than you spend.

Moving Ning to that cogent realization has been the unenviable task that has fallen to Rosenthal, who had been COO of Ning until he replaced its founding CEO, Gina Bianchini, in March.

Within a month, Rosenthal had whacked 40 percent of the staff, as well as the free, advertising-based Ning product.

In its place: A paid version that formally starts for the 300,000 active networks on its service tomorrow. While there is a 60-day free window, it’s all premium from here on out.

Wrote Rosenthal, in part, in a memo to staff in April:

“When I became CEO 30 days ago, I told you I would take a hard look at our business. This process has brought real clarity to what’s working, what’s not, and what we need to do now to make Ning a big success. My main conclusion is that we need to double down on our premium services business.”

There will also be cases of sponsored communities, such as a partnership announced today around healthcare, in which WEGO Health will provide Ning Plus service to the many health-related networks for free for one year.

Ning has also struck sponsorship relationship with Pearson Publishing on education-focused networks, for example.

We’ll see how it all goes, but it’s a true and much-needed shift from the growth-over-profits mentality that has seeped too deeply into the Web 2.0 ethos.

Now, it seems, it’s time to pay the piper, at least at Ning.

Here’s the video of my interview with Rosenthal about all this, as well as short tour on Ning’s HQ:


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