Behind Ning’s $750 million play

by Patricia Sellers

Ning CEO Gina Bianchini is getting lots of curious looks and occasional “Congratulations!” here at Fortune Brainstorm Tech. The news leaked this week that her start-up raised $15 million at a company valuation of…get this, $750 million.

That’s a stunning number, and incidentally, she didn’t ask for the new funding. On Tuesday night, before Bianchini and I both arrived here in Pasadena, California for Fortune’s annual tech confab, we saw each other at a dinner hosted by eBay (EBAY) North America boss Stephanie Tilenius in Silicon Valley. Bianchini (at far left in the photo to the right) that night confirmed the news about Ning’s new funding and told me that the investor, a venture capitalist she knew at Lightspeed Venture Partners, called, wanting to invest $15 million. Ning has sufficient cash, having already raised more than $100 million. Bianchini and Marc Andreessen, the Netscape founder who is Ning’s co-founder and chairman, accepted the new money anyway.

If you don’t know Ning, you should. The two-year-old company helps people build their own social networks. As Home Depot (HD) is to homeowners, Palo Alto-based Ning is to web inhabitants who seek to belong to niche networks relating to their interests and passions. There is, of course, a practically unlimited inventory of passions to mine–poker to paragliding to parenting orphans from China. As Bianchini says, every person has a “canonical identity”–a core self–and typically a half-dozen passions, or at least interests. The average Ning user, she says, belongs to about 1.5 Ning sites. That average is going up.

Bianchini is a savvy and aggressive promoter, as is Andreessen–who is on the cover of the current Fortune. Their “canonical identities,” if you will, help attract money to Ning, but so does the company’s growth story, which has surprised many skeptics. Today at a Brainstorm breakfast round-table about social networking, Bianchini noted that Ning is adding more than one million users every 15 days. The company has 29.3 million users, she says–half of them outside the U.S. There are 1.3 million Ning-constructed social networks across the web. Some 4,000 are being added everyday, Bianchini says.

Monetization is the goal and the necessity, of course. Ning generates revenues two ways: advertising, aided by Google (GOOG), and premium pricing from customers who want no ads on their sites. (Customers build sites for free if they accept Ning’s ads.) Bianchini is focusing on building out the user base, but, as users request them, adding revenue-driving services. Premium services could help Ning become cash-flow positive by early next year, say some observers.

One Ning service coming this fall: gifting. Incidentally, based on the buzz here at Brainstorm, gift-giving is a real sweet spot of the web. Facebook is ramping up gifting and online payments. And last night at the “Start-Up Idol” contest–Brainstorm’s version of American Idol–the best of show among five presenters was Giiv, a mobile gifting company that has one prominent angel investor: Google CEO Eric Schmidt.

Watch out for this little company, whose CEO is, like Bianchini, a young woman with an impressive resume and an apparent understanding of the ins and outs of marketing on the web: Michelle Crames, who comes out of Disney (DIS) and McKinsey and Harvard Business School. Giiv plans to launch its gift-giving site in August.