LinkedIn is now wholly owned by Microsoft. But you know that, don’t you? Unlike most big-ticket tech purchases, this one didn’t draw much attention from the public. Yes, you heard about it in the news, but, unlike many other acquisitions, there was no fanfare, bells ringing on Wall Street, or big announcements that were dubbed “Breaking News.” In fact, quiet acquisition has been Microsoft’s style since it began acquiring businesses in 1994, either wholly or by purchasing substantial stakes.
Microsoft quietly finalized its outright purchase of LinkedIn on December 8, 2016. Microsoft paid $26 billion, or $196 per a share, a $65 premium over the stock’s $131 per share, June 13, 2016 closing price. LinkedIn joined a stable of previous Microsoft purchases, or interests, like; Skype Technologies, Hotmail, a $1 billion interest in Comcast, a $200 million interest in Best Buy, and a $605 million interest in Barnes and Noble, to name just a fraction of its subsidiaries.
Microsoft has changed its acquisition strategy. Instead of playing catch-up in key technological areas, Microsoft now seeks to either get into “a market early or create new ones.” While the LinkedIn purchase did not cause a media frenzy, the “acquisition has a fairly strategic rational of combining Microsoft’s user presence with a business-oriented network.” The benefit for LinkedIn users may be, the business network finally growing into the networking powerhouse visualized in 2014.
BEFORE THE MICROSOFT SALE
Prior to its sale, LinkedIn was the go-to site for business to business, social networking. Users joined, created their profile (rather offhandedly), and then amassed as many connections as possible, like they were collecting chips at a poker table. Very few users actually “networked.”
Of course, there were power users. Users who understood the network’s benefits and used them to parlay connections into profits. But overall, LinkedIn became the professional Facebook. You collected users and boasted about the number of connections that you had amassed. Part of this lackadaisical attitude could be attributed to LinkedIn and its “let it flow” approach to user instruction.
Per CEO, Jeff Weiner, (at a presentation to Morgan Stanley) LinkedIn’s mission was to “connect the world’s professionals to make them more productive and successful.” Initially, LinkedIn achieved that goal; it saw membership climb from 32 million users to 277 million users in five years. At the same meeting, Weiner intoned that LinkedIn would, in the future, “create economic opportunity for every member of the global workforce.”
That’s not what happened. Instead, in 2015, LinkedIn faced staggered growth. It continued to acquire new members, but its unique member acquisition didn’t grow throughout 2015. Advertising on LinkedIn, an 18% profit driver for the network, dropped from 35% to 10%. Correspondingly, LinkedIn’s share price dropped.
After the sale was finalized and regulatory approvals granted, LinkedIn/Microsoft began making changes. LinkedIn’s first change was its introduction of ProFinder. ProFinder, introduced in March 2016, is a business to business, freelance matching service. Businesses that need services, i.e., accounting, design, marketing, or other services, create listings on the network. Seekers receive five business proposals, before the service request is closed.
LinkedIn initially built its service provider base by invitation. There is now an application process. LinkedIn performs all the service matching. ProFinder reviews the service request, and then contacts service providers, via email. Service providers are allowed 10 opportunities to submit proposals, before they are required to upgrade their account to Premium status.
LinkedIn is encouraging users to update their company page. Prior to the sale, the company page was a feature buried deep within LinkedIn. The feature was always there, just hard to access and utilize. LinkedIn now encourages company pages.
To use the feature, LinkedIn personal pages must meet six criteria, like, a company email address (no @gmail or @yahoo here), have an established personal profile and have a moderately developed profile with external links. (There are three other criteria, but in the interest of time, they are not listed.) LinkedIn cites several reasons in support of its company page. The foremost is to use a company page as a branding tool.
In a joint press conference, on June 13, 2016, the two companies proposed changes that they foresee for LinkedIn. One change is a unified business presence across the internet. Specifically, the companies propose using a single LinkedIn profile as an identifier on all Microsoft products, and elsewhere.
Another proposed change is an “intelligent” newsfeed. Per the announcement, LinkedIn’s newsfeed with provide real time information about a user’s network, profession and industry. Per the new LinkedIn, the newsfeed will become “a new daily habit.”
For those familiar with Cortana, it is proposed that the digital assistant will make its appearance on LinkedIn. For the uninitiated, Cortana is Microsoft’s answer to Siri. Windows 10 users know Cortana is lurking in the lower left hand corner of your screen. The new LinkedIn wants Cortana to prepare you for next business meeting. (I guess that means your assistant won’t have to keep your calendar anymore.)
LinkedIn is slowly becoming the professional social network it always wanted to become. In the past six months, it has quietly undergone changes. From ProFinder, online company promotions, to anticipated changes, LinkedIn promises to become a networking powerhouse. All users can do is wait and see.