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Microsoft Buying LinkedIn For $26.2 Billion
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jastroff
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jastroff,
User Rank: Ninja
6/18/2016 | 10:40:23 AM
Linked In Had a Very Good Business Model
Linked In essentially bet the store on getting enough professionals to sign up for their service, while leveraging these "free" memberships to companies and recruiters who wanted talent. How's that for smart? It did really pay off for them as they grew and grew. 

Here are some data points:

- About 60% of Linked In revenue is from talent solutions services – that is,  looking for people to hire by selling services to employers, companies and professional recruiters. Companies pay for enhanced search, access to candidates, branding.

- Also, advertising by companies accounts for a revenue stream of approx. 20%.

- LI leveraged the registration of professionals very well – approximately 80%  of these estimated 300 million registrations are still free.

- The paid consumer model was never the driver for LI revenue, It was the corporate/recruiter sell. Advertising has taken off as well.

I worked with HR professionals as a consultant, and they saw this as an answer to their problems if the user base was big enough. And it got big enough blue chip and many other companies worldwide to really hook their wagons to LI and pay for it.
jastroff
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jastroff,
User Rank: Ninja
6/17/2016 | 6:21:34 PM
Re: Well done MSFT
Do you think Linked In does a good job for "personal branding" if people are all represented by one template? I don't know, I'm asking -- 

 
Technocrati
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Technocrati,
User Rank: Ninja
6/17/2016 | 3:45:09 PM
Re: Well done MSFT

@jastroff   Excellent points.   The mud always gets deep when one really looks at MSFT.  I am literally tired of this company and it's self induced righteousness. 

TerryB
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TerryB,
User Rank: Ninja
6/14/2016 | 1:05:01 PM
Re: Well done MSFT
You mean like the frontline sales guys, a sort of more indepth business card? I'm struggling to believe a company wants to advertise their key technical guys to other companies to poach.

Would you say this branding more true for service companies, where people are really the product? Or do think that applies to mfg companies that make products we buy?

But I think I see where you are coming from in service. If your business is painting houses, you could certainly advertise talents/experience of your painters. Same with IT service industry, for sure. But sure seems like your competitors would then have a source to steal your employees they might want. They certainly be able to reach out to them without paying headhunters like the old days.
vnewman2
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vnewman2,
User Rank: Ninja
6/14/2016 | 12:56:05 PM
Re: Well done MSFT
I think the "personal branding" of the individual people that make up the business is what is alluring about LinkedIn.  Marketing no longer focuses on promoting the company alone, this shift is showcasing the individuals and what they can bring to the table as a representative of the company - and that's where LinkedIn comes in.
TerryB
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TerryB,
User Rank: Ninja
6/14/2016 | 12:50:24 PM
Re: Well done MSFT
I wonder if "business" cares one bit about LinkedIn, as far as tool to improve their bottom line? Business PEOPLE like it because it helps them network to find another job if they need/have to. Other than acting as an online reference for HR when evaluating perspective hires (which I would take with grain of salt anyway, like anything internet based), what else does it do that helps the "business" of a company?

Or do people use this as a poor man's CRM, a way to keep in touch with your supply chain?

Like most of these type things (Facebook, Twitter, etc), I'm always fuzzy how they generate cash/profit anyway, other than digital ads. I hope this doesn't lead to MS Office or Windows having ads in it. :-)
jastroff
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jastroff,
User Rank: Ninja
6/14/2016 | 10:08:35 AM
Re: Well done MSFT
@technorati -- all good points, but consider...

- lowering the price of anything is a different business decision than buying companies. But it would be nice to see more affordable good from them.

- MSFT has $92 billion in free cash with which to buy companies, most of the money is off shore in tax havens

- MSFT borrowed to buy Linked In to keep the lower tax rate on the payment favorable and not dip into its capital

They paid a 50% premimum on the Linked In share, so you can argued they overpaid
Joe Stanganelli
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Joe Stanganelli,
User Rank: Author
6/14/2016 | 6:30:25 AM
Re: Well done MSFT
The important thing is that -- unlike, say, a company like Yahoo -- they didn't ruin Skype and they were still able to integrate rate it reasonably well into their portfolio of existing products while letting the acquisition maintain its functionality and identity. I suspect that will be the case here, too.
Technocrati
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Technocrati,
User Rank: Ninja
6/13/2016 | 7:24:02 PM
Re: Well done MSFT

@jastroff    I agree.  I am not excited about this at all. The proof is in the execution and most of us know how well MSFT is at that. 

In another tread I am arguing that MSFT can't seem to lower the price of a Surface but can somehow come up with billions to buy a social network ?    

 

That's what I find interesting.

jastroff
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jastroff,
User Rank: Ninja
6/13/2016 | 3:57:39 PM
Re: Well done MSFT
@vnewman2 -- Agree, it will be interesting. But MSFT tends to blunder into things and do nothing special with them (Skype), and I have less hope they will make it all work as an integrated whole. And I expect downtime and updates from Linked In now, sadly.

But, if they do make it work, it could be a viable (if somewhat large) enterprise and SMB social and office system. 
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