This is the first part of a series of posts about LinkedIn, which I have initiated here. The purpose of this series is to bring forth an understanding and perspective towards LinkedIn and create a base to engender opinion that will benefit all.
LinkedIn, the world’s largest online professional network, has redefined the way we associate as professionals, be it as recruiters trying to source candidates or salespeople trying to generate leads in a market or even job-seekers looking for opportunities in a field or company of our desire and aspirations. It has completely changed the labour landscape across the globe, but the moot point is that it is just getting started. According to a piece by The Economist – Workers of the world, log in – LinkedIn’s aspirations do not halt at its current stance; rather, they extend much beyond those to broader goals that impact the global labour force.
But before we delve into the way LinkedIn aims to alter the global workforce, let’s have a look at how LinkedIn came about to its current stage of connecting professionals. This post chronicles the history of the professional network, from inception to the present.
LinkedIn wasn’t always envisioned as the torch-bearer of professionals. What began as a “network of people“, as cited in the article, has ballooned into “an online contact book, curriculum vitae and publishing platform for anyone wanting to make their way in the world of work”. With over 300million members this year, LinkedIn is rapidly becoming the professional Facebook, aiding people in a host of tasks such as recruitment, sales and job search.
It had a turbulent start, however. In 2003, when Reid Hoffman, after stints at PayPal and Yahoo, huddled with his team to start LinkedIn, he had not anticipated a clear line of business. LinkedIn was like a platform to connect entrepreneurs which went on to initiate its first two lines of business, Jobs and Subscriptions, after two years of operations. During this time, however, they were rapidly changing office spaces and did not seem quite stable.
However, Hoffman moved out of the CEO position to focus on his own ventures, allowing Jeff Weiner to reign as the President and eventually take up the CEO mantle in 2008. By then, LinkedIn had accumulated 50million members, set out on its global strategy and was valued at a billion dollars.
From then on, it was considerably smooth sailing under stable yet visionary leadership of Weiner, who accelerated the growth and expansion, provided renewed strategic direction and developed clearly defined business lines for different market segments. As LinkedIn became more streamlined, it also featured among the sought-after start-ups rapidly escalating the ladder to an IPO. So, when LinkedIn went public on May 19, 2011 with the “LNKD” ticker at $45 a share, it scooped up cash and the trust of investors, with shares rising as much as 171 percent on the first day of trading.
Its acquisition of Mspoke, a start-up in the technological sphere of recommendations, in 2010 and the $20million investment from Tiger Global Management LLC had already paved the way to a successful IPO. But the cash influx only propelled its ambitions further. It acquired CardMunch in 2011 and introduced one of its most useful features – “Apply with LinkedIn” button – to integrate with job listings.
Its revenue in 2011 of $154million overshadowed even that of Twitter, and despite the short-lived notoriety owing to the hacking in 2012 of 6million profiles, LinkedIn went ahead full steam with its global expansionary plans. In 2012, it also underwent a metamorphosis of its site, introducing a new look-and-feel to its profile pages, additional features on the site and mobile apps for people who preferred to stay connected on-the-go.
By the time it celebrated its decade of existence, LinkedIn had expanded into several geographies, with its fastest growing numbers coming from India. At the start of this year, two of the top five countries with the most members were the emerging markets of India and Brazil.
Now, professionals seeking to expand their network use LinkedIn as an online contact book, adding friends and other people of interest. The details listed on the site amount to the curriculum vitae of users, who cite their school, college, degrees, professional certifications, achievements, work experience and several other data points available on the platform.
But one of the most important aspects of LinkedIn that has been a good crowd-puller is its publishing platform. Surprisingly, LinkedIn is among the first few platforms to be able to integrate its content publishing platform with its core competency of connecting people professionally. LinkedIn Influencers, key people such as Richard Branson, Arianna Huffington and several others, share their insights, life learning and advice with readers who follow them. There is often immensely valuable content shared by these visionaries and entrepreneurial geniuses. Such a platform allows readers such as me to connect with their idols and peek into the world of the rich and the famous.
Probably the most impressive aspect of LinkedIn is not just its journey from a start-up emerging from a one-bedroom apartment to a multi-billion dollar global enterprise, but also its aspirations to impact and benefit global labour. The Economist cites Jeff Weiner’s ambitions of tapping into the global labour force of approximately 3billion and positioning itself as not just an aid to recruitment, but more as a driver for improving labour efficiency.
LinkedIn wants to change not only the business of recruiting, but also the operation of labour markets and, with that, the efficiency of economies.
Before we look at how LinkedIn plans to do that, let’s consider what LinkedIn offers and how its solutions contribute to its financials.