Have any of your friends ever told you any of the following?
“I have a LinkedIn profile but never check it.”
“I hate the messaging platform of LinkedIn.”
“LinkedIn is dying.”
Well, they may be in for a few surprises.
Because LinkedIn has quietly been staging an impressive revival, and it’s only going to get better.
How do I know?
I’ve got it straight from the mouth of Microsoft’s CEO, Satya Nadella. Since 2016, Microsoft owns 100% of LinkedIn. What I recently heard from Mr. Nadella when listening to him at an event matches my recent observations of LinkedIn’s performance. That is the reason why I am inclined to believe him.
For anyone who owns a business or has a way to use LinkedIn to further their career or increase their income, now is the right moment to revisit how you use this professional network.
Let me explain.
LinkedIn has been an underdog
LinkedIn certainly isn’t the world’s largest social network.
Facebook towers above them all, with 2 billion users. Associated with Facebook are a few other platforms that are often counted as a social network in their own right, i.e. Facebook Messenger (1.3 billion) and WhatsApp (1.2 billion). Google owns YouTube which has 1.5 billion users logging in every month to watch videos.
There are non-US, non-European social networks like QQ (850 million) and WeChat (889 million).
Instagram has 700 million users, and Tumblr is used by 550 million.
These figures make LinkedIn’s 500 million users look small by comparison. It has overtaken the struggling Twitter platform’s 328 million users, but within today’s globalised networks, 500 million just about puts you into the global top 10 league table of social networks. Where it under-performed was the number of its active users. Only a quarter of LinkedIn users regularly logged onto the platform. The company’s initial strategy to essentially offer its users a public profile only ever had so much appeal. Having only a quarter of your users active is a devastating statistic; it means three out of four users don’t really use the platform.
As Mr. Nadella put it: “What we aspire to do through LinkedIn is to build a network to … create economic opportunities for individuals.”
However, I believe LinkedIn has successfully taken the first steps towards becoming the world’s most valuable social network regarding the benefits it delivers to its users.
As Mr. Nadella put it: “What we aspire to do through LinkedIn is to build a network to … create economic opportunities for individuals.”
This article is going to explain to you why this one sentence is so important, and why now is a unique moment for you to get your act together if you aren’t actively using LinkedIn yet to build your business.
Microsoft’s biggest acquisition yet
Back in 2016, Microsoft paid $26.2bn to acquire LinkedIn. It paid a whopping 50% premium compared to the share price before the acquisition. That’s not counting another $2.6bn in liabilities Microsoft had to take on.
In the overview of acquisitions done by Microsoft in its 43-year history, LinkedIn towers way above all other purchases. Up until that time, Skype had been the company’s largest take-over, priced at $8.5bn; followed by Nokia for $7.9bn. It was also one of the most expensive transactions in the annals of technology. All previous major acquisitions by Microsoft were a disaster, by the way.
Many media observers weren’t exactly kind in their evaluation of Microsoft buying LinkedIn:
“Microsoft just paid way too much for LinkedIn Acquisition“
Fortune
“4 Reasons Microsoft Wasted $26.2bn To Buy LinkedIn“
Forbes
“Microsoft Vastly Overpays For LinkedIn“
David Trainer on SeekingAlpha
There were a lot of valid points in their critical assessment. What they missed, however, was the visionary long-term plan that Mr. Nadella, backed by Bill Gates, had worked out for the new combination of LinkedIn and Microsoft.
Which, I dare say, has recently started to become visible.
Noticed anything about the LinkedIn feed?
After the announcement of the acquisition, Fortune published an article “Here’s What Bill Gates Thinks of Microsoft’s Acquisition of LinkedIn.“
In it he mentioned:
“If we can make the LinkedIn professional feed as valuable as the Facebook feed in the social world, that’s huge value creation, and that’ll happen over a period of years.”
Over the past year, I have repeatedly been telling friends to keep an eye on the changes Microsoft was implementing to the LinkedIn platform. Most of them were small changes. Over time, they added up. I noticed them because even back then, I logged onto LinkedIn almost every day.
What these small changes resulted in, is that today, the LinkedIn newsfeed has experienced the first phase of a revival.
Momentum is now on LinkedIn’s side.
Just the other day, I noticed someone who previously told me “I hate LinkedIn” actively using his LinkedIn feed.
When I publish an article on the relaunched LinkedIn publishing platform (formerly called “Pulse” and now called “Publishing”), it gets not just lots of attention, but it gets the right kind of attention.
Never mind the changes I noticed to LinkedIn’s messenger platform. It’s still far from perfect. But it has been improved, and it’s now being used by a growing number of people. When I send out messages via LinkedIn, they usually get read. I receive an increasing number of useful, non-spam messages via LinkedIn.
Momentum is now on LinkedIn’s side.
During the first half of 2017, LinkedIn launched (or re-launched) more features than during all of 2016 combined.
If you are an active user of the platform – as I am – then you notice these changes.
The long-term goal
Messieurs Nadella and Gates spotted a business opportunity to build a social network for the working world.
Facebook might have four times more users, but there is something compelling about the quality of LinkedIn users.
E.g., when I post an article on LinkedIn, about 5% of the views I am getting there are from CEOs/Executive Directors. These are the kind of people I want my content to be put in front of. Re-launched LinkedIn analytics is telling me a lot about who has been looking at my content, and I find the LinkedIn audience to be of high quality (which is also linked to it being easier to connect with these sort of people on LinkedIn than it is to connect with them on other platforms). The stats coming out of LinkedIn also include information about which companies the people who saw my content work for, and in which geographic regions/cities they are based.
Obviously, people use social networks for different reasons.
If you have a safe job that you are satisfied with and where you don’t need to reach out to potential new clients and contacts, then LinkedIn might not be relevant for you.
If you are passionate about sharing photos of cats or babies with your family, then LinkedIn isn’t going to work for you either.
However, for the world’s workforce, LinkedIn is only going to get more relevant and useful from here onwards.
After all, Microsoft has an immediate – and unique – reach to so many of them, through the dominant market share of Windows and its related products such as Office. Currently, 1 billion people around the world already use Microsoft products.
Huge synergies with Microsoft
Let’s make no mistake about it, integrating two companies is a messy, lengthy and risky process.
An HR expert from Bangladesh, Biswa Bhusan Swain, made an effort to write a publicly available PowerPoint presentation about the difficulties Microsoft is likely going to experience in integrating the LinkedIn acquisition.
Even Microsoft indirectly admitted this was not going to be an easy integration. The company’s own presentation of the transaction is mostly speaking in generalities, and it politely leaves out the issue of short-term financial challenges thrown up by the acquisition, such as LinkedIn not generating all that much revenue.
However, what the company presentation also mentioned was the opportunity to connect LinkedIn to the software and services the company provides to 1 billion users worldwide, many of whom professionals and business owners.
If Microsoft/LinkedIn plays its cards right, LinkedIn could for many become the world’s most useful – and financially beneficial – social platform to be on.
E.g., Microsoft operates one of the world’s largest cloud computing services. Through its deep reach into many of the world’s largest companies, Microsoft can now build new services for LinkedIn users. Wouldn’t you love to know when one of your contacts at a client is moving on and who the replacement is? In the future, using big data and artificial intelligence, LinkedIn will be able to provide you with such information.
How much is such information worth?
If Microsoft/LinkedIn plays its cards right, LinkedIn could for many become the world’s most useful – and financially beneficial – social platform to be on.
It’s all in the data
All the major players in the technology industry know more about you than ever before. It’s actually quite scary how much. Software has become less important in recent years, now it’s more about the data.
Amidst the many voices critical of the acquisition at the time, there were also a few who saw the upside. Among them the clever people from The Register, one of the world’s largest website for articles by/from IT professionals.
“Microsoft’s paid $60 per LinkedIn user – and it’s a bargain“, is how The Register put it.
What Microsoft purchased when taking over LinkedIn was the enormous personal data that LinkedIn users have uploaded to their profiles.
Through this data, Microsoft can target LinkedIn users to offer them additional services.
No doubt, Microsoft will use LinkedIn to soon provide a whole range of other services, e.g.:
- Education, i.e., providing users with intelligence on training resources.
- Customer Relationship Management (CRM), to enable small and medium-sized enterprises (and even sole traders) to compete with companies that use Salesforce. Think of LinkedIn as a B2B marketing tool.
- Virtual personal assistant, linking LinkedIn users both to Microsoft software as well as to other humans on the platform who are offering their services (cheap assistants from Bangladesh, anyone?).
As Nadella describes on pages 232/233 of his new book “Hit Refresh“, he wants to make LinkedIn work for the 3 billion members of the world’s workforce.
He has even signed up the perfect person to make it happen.
Meet Reid Hoffman
In March 2017, Microsoft announced that Reid Hoffman, the founder of LinkedIn, was joining its board.
Everyone has heard of Mark Zuckerberg, but fewer know who Reid Hoffman is.
Hoffman was the man who started the first social networking website, Socialnet.com, back in 1997. That was seven years before Facebook was started. If you so will, Reid is one of the true pioneers of the social networking space. He also helped broker Facebook’s first $500,000 investment, of which $40,000 came from him (one of the best investments in the history of the world!).
Hoffman has deep connections in Silicon Valley. He was also involved with managing a seed fund that invested into Dropbox, Airbnb, and Tumblr; besides many others.
Hoffman and Nadella discovered that they shared a similar vision for “spreading opportunity more equitable to everyone.” They wanted to build LinkedIn into a tool that enables professionals, business owners, and entrepreneurs.
Now that the first signs of their strategy’s success are visible, I urge you to consider investing more time and effort into your LinkedIn profile.
The early bird catches the worm – what you should do now
Imagine you had set up the first photo-based travel blog on Instagram. On new social platforms, the early adopters get to reap a lot of benefits because they face little competition when building their audience.
LinkedIn isn’t new, but there is now a real opportunity to become an early adopter of what I would call “LinkedIn 2.0”. The platform is getting an entirely new lease of life. Those who are on top of these changes can reap various benefits.
If you run a company or have colleagues that you work with, make them consider using LinkedIn more actively.
It’s difficult to give specific advice, given that LinkedIn can be used for so many purposes.
Speaking generally, I have found it useful for my own business to:
1: Regularly review and improve your own LinkedIn profile
Just like with any other social network, what you publish and how you publish it is an art more than a science. You have to try out things to find out what works. I noticed that my efforts to improve my own LinkedIn profile have contributed to how my personal brand is perceived; who contacts me out of the blue with interesting propositions; and how people react when they get a LinkedIn message from me.
Also, there are a lot of free articles and videos on the web about how to improve your profile. There are too many for me to recommend any particular one.
2: Invest time into learning about LinkedIn’s tools and services
These are now regularly being expanded (or relaunched). Again, no one learns these things overnight, and you need to regularly expose yourself to these new opportunities and play with them. Some will turn out to be a waste of your time, but others will turn out to be useful. Over time, you’ll become a LinkedIn Pro. That in itself will be a valuable skill to add to your CV or to your toolbox for running your own business.
3: Make your company use LinkedIn actively
If you run a company or have colleagues that you work with, make them consider using LinkedIn more actively. There could be immediate synergies for you to exploit, e.g., if you have some of your colleagues use the LinkedIn Publishing platform, consider if they can also mention you and refer to your profile. These are quick wins and set you on the right path. Never mind the above-mentioned new possibilities that LinkedIn is bound to offer going forward.
Facebook, watch out!
Everyone has their favourite social network(s), and everyone will have an opinion about which network is more useful or has better prospects for the future.
This article isn’t aimed to say LinkedIn will replace one or the other network, nor is there any social network that fits everyone’s needs. There is no right or wrong with social networks; there are simply lots of different options and people choosing their networks based on their needs and preference.
However, it does strike me as interesting that LinkedIn and Facebook are currently showing two different dynamics.
Facebook, in my subjective view, has developed a whole number of issues:
- Its newsfeed is now laden with politics. This isn’t helped by Mark Zuckerberg’s obvious attempts to have a foot in the door for a future presidential election. Facebook is becoming politicised in several ways.
- Many Facebook users, encouraged by Facebook, are using the platform for business purposes, even sending business-related emails through Messenger. It’s neither a purely “social” network nor a “professional” network. Which is frustrating for many.
- A lot of paying advertisers will have recently made the experience that advertising on Facebook is a lot less lucrative than previously thought. There is a whole separate discussion about the effectiveness of advertising on social media platforms, and so far, Facebook is still doing extremely well in terms of growing its advertising income. Without a doubt though, advertisers are becoming more discerning about how and where they spend their money. It could turn out that Facebook so far has had it too easy.
In these critical points, LinkedIn seems to offer a better deal:
- In the debate I attended with Nadella, the moderator’s attempt to make Nadella give a political statement about the US Presidency were decisively deflected by him. Microsoft is smart enough to not politicise itself.
- At least so far, LinkedIn has kept its focus on being a professional network. It would be desireable to see LinkedIn undertaking active steps aimed at keeping its platform’s focus. So far, at least my own newsfeed is pleasantly devoid of cats and babies.
- Because of what LinkedIn enables you to do, it is potentially an extremely valuable platform for users and advertisers. I haven’t done advertising on LinkedIn, but I do know for sure that the $70 a month I spend on my LinkedIn premium membership is yielding me a huge return, and certainly a higher return in absolute terms than Facebook’s “free” platform. My definition of “return” in this case being based on: new business contacts cultivated; concrete clients leads and transactions arranged; and visibility of my content and my personal brand among the right clientele.
On that note, I wonder how many Facebook users will in the foreseeable future migrate their efforts to LinkedIn?
I am, certainly, among them. Given Facebook’s 2 billion users and LinkedIn’s 500 million users, even a relatively small shift can have a significant effect on LinkedIn and that way put more momentum behind the platform.
Follow the story as it emerges
It’s still early days for LinkedIn 2.0. For the past year, I have had a gut feeling that these sort of developments were coming. Listening to Nadella during his visit to London, I had a bit of an epiphany. When he spoke about LinkedIn, my thought was, “Damn, this is really happening.”
However, you are the judge. I welcome any and all feedback about my view of LinkedIn’s current trajectory. Fostering conversations with some of my readers (and between them) is one of the objectives of this blog. I’d love to hear from you if you think there is something you can contribute to my thinking on the subject.
In the meantime, for anyone eager to now follow this story further, I recommend the blog that LinkedIn is publishing. By following it, you’ll keep yourself abreast (and educated) about the latest features and functions being added to the LinkedIn platform.
E.g., I recently read “Building the World’s most effective B2B marketing platform“, an article that appeared on the LinkedIn Marketing Solutions blog.
With Nadella’s new book out, there are now also an increasing number of articles that touch on his plans for LinkedIn. E.g., I recommend you read “Nadella: Buying LinkedIn for $26.2bn was better than partnering with it.“
LinkedIn CEO Jeffrey Weiner said a while ago: “Just as we have changed the way the world connects to opportunity, this relationship with Microsoft, and the combination of their cloud and LinkedIn’s network, now gives us a chance to also change the way the world works.”
I have a feeling that if you have a career to improve or a business to build, this story of a corporate revival is now one worth watching because of the benefits it could deliver to you personally.
If you enjoyed this article, you might also find the following articles useful:
Want to print this article? Open a printer friendly version.
Did you find this article useful and enjoyable? If you want to read my next articles right when they come out, please sign up to my email list.
Share this post:
My trilogy of investment books
Available to pre-order now!
2nd, revised and expanded edition
