(Ecofin Agency) - French social network, Viadeo, which planned to go global eying emerging markets, Africa included, went bankrupt after failing expansion. The firm on November 29, 2016 was placed under receivership by the Paris Commercial Court. It will be liquidated in three months.

Viadeo is a professional social network which positioned itself as the direct rival of U.S. network LinkedIn. However, the company lacked funds to develop, explained its CEO, Renier Lemmens who was appointed this year after the previous CEO and co-founder (with Thierry Lunati) Dan Serfaty resigned.

Since it was launched in 2014, the French startup was able to raise only €37.7 million. An insufficient sum for the company which had already started global expansion. In 2010, Viadeo was already present in Canada, Spain, the United Kingdom, Italy, India, Mexico, and U.S. The year before that, it had acquired its Chinese counterpart, Tianji. The social network had also acquired Indian Apna Circle and Canadian Unyk. Next, it entered into a joint-venture with Russian Sanoma Indepedant Media, bought Dutch firm Soocial and Chinese Zaizher.

In 2009, Viadeo had 25 million users. In 2014, it declared having 60 million users but derived 95% of its revenues from its users in France. “They spent a lot trying to go global, but targeted markets too difficult for them,” said Jérôme Colin, telecom, media and internet expert at consulting firm Roland Berger, cited by Les Echos.

It was difficult for Viadeo to sell paid subscriptions to its users, in emerging markets mostly, which were its main target. “They went too quickly. Their free platform was limited and many of their users got tired of it,” Colin added.

Since listing on the Paris stock exchange in 2014, the firm’s value kept plummeting as its turnover slumped and its losses cumulated, reaching €13.4 million for the financial year 2014. When it was placed under receivership, Viadeo was valued 

at €10 million only. In a press release, the firm said “shareholders should consider that Viadeo shares have no more value”.

Assongmo Necdem