LinkedIn – The Social Site Sleeper?
By Anna Johnson on July 3rd, 2008Is LinkedIn – the social networking site aimed at professionals and business owners the social site sleeper? While MySpace and Facebook receive much of the attention given to social network sites, LinkedIn is quietly recruiting more and more users, raising capital, and making money.
Last week, LinkedIn announced it had received $53 million in venture capital, mainly from Boston-based Bain Capital Ventures. This new financing round sees the company valued at $1 billion. That’s nearly double the $580 million that News Corporation paid for MySpace in 2005, although substantially less than the $15 billion value assigned to Facebook in 2007 when Microsoft bought a minority stake.
LinkedIn has only 23 million members (compared with estimates of around 115 million users of Facebook and MySpace respectively) but says that it’s profitable. Compared with Facebook and MySpace, LinkedIn also has more diverse revenue streams. Only about a quarter of its expected $100 million for 2008 will come from advertising; its other revenue streams include premium subscriptions (which allow users to directly contact each other without an introduction), recruitment tools that allow companies to find people who may not be looking for a job, and services specifically aimed at companies.
Personally, I have a LinkedIn account, although I have barely used it to its potential. My husband, on the other hand, has built up an extremely impressive LinkedIn network.
For Internet marketers, I see the best use of LinkedIn as a networking tool for establishing connections and potentially joint ventures.
Source: Brad Stone, “At Social Site, Only the Businesslike Need Apply”, The New York Times, June 18, 2008
