Is Pinterest Really Worth $3.8 Billion?

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Oct. 24 (Bloomberg) -- Tailwind CEO and Co-Founder Daniel Maloney discusses Pinterest's valuation with Emily Chang on Bloomberg Television's "Bloomberg West." (Source: Bloomberg)

Through skype.

Three $.8 billion, is pinterest really worth that much?

Yes, i believe it is.

The beauty behind pinterest is not just the pins it, but the rich data that underlines it.

They are building something called the interest graph, which is extort narrowly valuable to marketers.

But pinterest at this point barely makes money.

They just started rolling out an advertising product.

How can we know that they will make money down the line?

As with any successful startup, at some point, they were not making money.

I think they have the right energy by focusing on user growth first.

That is what you have to do in that type of market.

I think now is probably the right time for them to start the advertising test that they are running.

But even without those tests being very mature at this point, there is already anecdotal evidence from many providers showing that pinterest is highly effective for brands and they are showing a great return.

You run a company.

It seems like interest just raised money.

Isn't it dangerous to raise money at such a high valuation, because it means down the line they have to have an even bigger exit to satisfy investors?

I'm sure that the investors did due diligence and the pinterest team knows better than anyone the path they are on.

The investors can probably speak to that better than anyone.

If you look at the history of the evolution of other major internet players, i don't think this is out of line relative to the level of growth that pinterest has seen.

You might help companies expand their presence on pinterest.

What does that mean?

Brands want to understand what is happening on pinterest.

What are companies pinning from their own sites, their competitors sites?

Who they want to connect with?

Who are their biggest fans?

We help them go through the massive amount of data occurring on pinterest everyday down to the national brands that they can use to inform their marketing campaigns both on and off pinterest.

The more successful that pinterest is, the better it is for you, right?

Yes, emily, that is true.

What do you see as the power of pinterest down the line?

Five years from now, how big a deal will pinterest be?

I think it will be a very big deal and it will be a permanent utility in the internet world.

The way you think about facebook creating a social graph and google launching to research, i think pinterest will launch discovery in an entirely new way through user interest.

And i think over time they will allow the internet to do that to a greater extent as well.

That means all publishers, all marketers, all brands will be able to better align the content and products they are getting out there with what people want.

And users in return, will be able to make the connection from desires and interests to real- life action.

What does this mean for a company like amazon, currently the world's largest e-commerce company?

I think this is an opportunity for amazon as well.

I'm sure they are looking for new ways to grow any news way -- new way to reach audiences.

I see no reason why they should not also be looking to pinterest as a potential growth general -- channel for their own interest.

Thank you for joining us.

Both amazon and microsoft report

This text has been automatically generated. It may not be 100% accurate.

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