Tagged is a San Franciso based social network founded by my friend Greg Tseng, an Asian American entrepreneur, and Johann Schleier-Smith. Tagged is different from Facebook in that it engages users who want to find new friends. Greg told me that Tagged is doing well with 25 million monthly users, 4 billion monthly page views which makes it a Top 100 site in the world, and profitable at roughly $1.25M monthly.
The company recently raised $5 million in debt financing instead of the traditional equity financing because they are profitable. Given how wary investors are in this current economic crisis, so equity financing could lead to really unfavorable term sheets. By going with debt financing, they are able to use their monthly profits to pay off the loan over time. Given Tagged’s profitability and growing user base, I’m not surprised if Greg were to sell the company at the right price.
30% of Tagged’s traffic comes from the United States which is great since advertising revenues are stronger in North America. However, given that 70% of their traffic is international, I cannot be wonder how much growth they could get if they were to target Asia too. Granted, they would be competing with Xiaonei, but Kaixin101 has already shown the social networking world that Xiaonei doesn’t completely dominate. To appeal to the Asian masses, Tagged needs to first internationalize their pages. Once they get that in place, they can potentially get their active community to help on that just like Meebo and Facebook did.