origins of linkedin
TRANSCRIPT
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Danielle Forward • Fall 2016 • Creative Founder
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In Fall 2002, everyone thought the consumer internet was dead.
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“In a boom, employers are really hunting for a good person, and they're using LinkedIn. And during a
bust, people on the other side are looking for a good opportunity.”
Reid Hoffman, Principal Founder, LinkedIn
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Reid provided the initial seed funding to launch LinkedIn publicly on May 5, 2003.
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Reid and his team pitched LinkedIn to over 24 different venture capital firms and repeatedly faced rejection.
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Finally, Sequoia Capital, an investor of PayPal, said they would lead the Series A funding—a $4.7 million
round which closed in November 2003.
Reid and his team pitched LinkedIn to over 24 different venture capital firms and repeatedly faced rejection.
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“Mark Kvamme, partner at Sequoia Capital
LinkedIn provides both patented and effective technology that has the power to transform hiring
—very much in the way PayPal re-engineered the transfer of money and Google dramatically increased
the utility of the Internet for individual consumers and professionals.
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LinkedIn was successful because it didn’t need to rely on an economic boom to succeed, but rather
facilitated economic activity itself.
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Today, LinkedIn has over 450,000,000 members and took in almost 3 billion in revenue in 2015.
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Today, LinkedIn has over 450,000,000 members and took in almost 3 billion in revenue in 2015.
But only 25% of those users are active monthly, and despite high revenue, recorded a net loss of
$162 million.
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20162015201420132012
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2015201420132012 2016
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Most people aren’t looking to change jobs all the time. Instead, they want to communicate and build relationships
. . . As a result, LinkedIn is now, at best, a business card holder. At worst, it’s a delivery service for spam.
—TechCrunch
“
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+$26.2 billion · June 13, 2016
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Understand your audience. Who are you pitching to? Research investors thoroughly.
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Understand your audience.
Understand the broader financing climate
Who are you pitching to? Research investors thoroughly.
When Reid was pitching LinkedIn, most investors were wary of how consumer internet businesses made money, so he addressed the issue head-on.
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Sources
http://fortune.com/2011/05/26/how-linkedin-first-raised-money-and-endured-rejection/
https://mixergy.com/interviews/konstantin-guericke-linkedin-interview/
http://www.huffingtonpost.com/2011/05/19/linkedin-ipo-success_n_864248.html
http://www.reuters.com/article/us-lnkin-corp-results-idUSKCN0VD2SL
http://www.inc.com/jeff-bercovici/microsoft-linkedin-social.html
http://www.cnbc.com/2016/07/07/linkedin-co-founder-hoffman-why-we-sold-to-microsoft.html
http://time.com/4366106/linkedin-microsoft-why/
https://techcrunch.com/2016/02/23/linkedin-problems-run-deeper-than-valuation/
http://www.forbes.com/sites/antoinegara/2016/06/13/linkedin-is-the-latest-fast-growing-tech-company-to-give-up-on-the-stock-market/#1bc3a02050be
http://www.reuters.com/article/linkedin-results-research-idUSKCN0VE1N0
http://www.businessinsider.com/the-story-of-linkedins-stunning-success--as-told-by-the-people-who-were-there-2011-6?op=1
https://ourstory.linkedin.com/
https://ycharts.com/companies/LNKD/market_cap
http://www.cnbc.com/2016/02/04/linkedin-reports-q4-earnings.html
http://reidhoffman.org/linkedin-pitch-to-greylock/