HQ: Mountain View, CA
Sector: Social Networking
Founded: December 2002; launched May 2003
Management: LinkedIn’s CEO Reid Hoffman was formerly EVP of PayPal. Hoffman had previously founded two other social networking companies – the first one was SocialNet back in 1997 and he seems to have learned from previous failures. Hoffman is certainly the one manager in this sphere that is in no danger of losing his job.
Investors: Hoffman bootstrapped with $700K, then Sequoia Capital invested $4.7M in series A in November 2003.
Business Model: LinkedIn is currently free, but anticipates a hybrid model of subscriptions and ads. Company is positioned as the leading site for business networking – founder believes strongly that business and dating networks don’t mix. Company currently claims 700K+ members and boasts numerous kings/queens of industry. LinkedIn and ZeroDegrees are currently focused on individual users, whereas Spoke and Visible Path are enterprise sales. In the long run, LinkedIn could evolve into the individual’s site for storing his or her network and biography. As for the user experience, at this point it feels like a big party, but getting bored waiting for something to happen.
Competitors: The business-focused social networking sites are: Visible Path, Ryze, eCademy, ZeroDegrees, Monster.com Networking, and Spoke Software.
Dirt: This space has seen meteoric rises in traffic and as a result there are countless entrants. Size can actually be a detriment. Witness Friendster’s fall-offs in traffic which many attribute to its overgrowth as well as “exclusive” policies by Orkut and Linked-In to only allow members who have been invited. It doesn’t matter if the party sucks – if there’s a velvet rope, people always want to get in.