Born in Palo Alto (California, United States), a mecca of technological entrepreneurship, Reid Hoffman founded his first business when he turned 30 It was called SocialNet and Hoffman himself explained a few years ago that “it focused on online dating and putting people with similar interests in contact, like golfers looking for a partner in their neighborhood.”
The idea was totally groundbreaking and today it is understood as one of the first attempts to create not just a dating website, but a social network as we understand it today: Hoffman founded SocialNet in 1997long before Zuckerberg launched Facemash (2003), the prototype of Facebook, or Tinder (2011).
However, It was an absolute failure: In its first month of life, it only got 2 clients.
Two years later, he decided to abandon the project to join the adventure started by an old friend of his from Stanford University: Peter Thiel, one of the co-founders —along with a certain Elon Musk— of PayPal and one of the key people who explain the evolution of the last 30 years in Silicon Valley.
Hoffman joined PayPal as executive vice president.He was the head firefighter at PayPal“I was a millionaire,” Thiel said years later, referring to all the fires he had to put out. It was by putting out those fires that he became a multimillionaire, after the company went public in 2002. Months later, eBay bought the company and once again it was time to pack his bags.
He invested part of the money he earned from PayPal in setting up his next company, LinkedIn, which he founded in December 2002 with two former colleagues from SocialNet. The platform was officially launched on May 5, 2003 — 20 years ago today — and it did not have an easy time: at that time it seemed that the race would end up being won by Friendster, now defunct.
“One of the things I thought about every week was, ‘What if we don’t make it? How can we die with dignity?'” Hoffman confessed years ago. It took LinkedIn 5 years to make its first profitbut then came the explosion of users—millions of people looking for work after the Great Recession—and its total success.
In 2011, it went public and in 2016 it was bought by Microsoft for $26.2 billion in one of the biggest deals in the history of the technology sector. Today it has 930 million users — more than TikTok, at least for now — in 200 territories around the world.
In these 20 years, LinkedIn has changed considerably, going from being a platform designed to generate a network of contacts to becoming a social network where you can write current articles, broadcast live videos or attend courses to boost your own professional career.
Along the way, it has had to face significant challenges, such as the adoption of a subscription service (LinkedIn Premium), its IPO in 2011 (thus becoming the first social network to be listed on that market) or the stock market crash it experienced in 2016, which plunged it into a crisis that led to the sale of the company for $26.2 billion to Microsoft.
“In 2003 we had 45,000 members (…), 20 years later we have passed 930 million”
Courtesy of LinkedIn
Ángel Sáenz de Cenzano has been at the helm of LinkedIn Spain and Portugal for three and a half years and says that in these 20 years the social network has changed a lot, but has remained faithful to the original vision of its founders: “Providing economic opportunities for members of the global workforce. That is the vision we had and continue to have.”
The manager refers to the increase in the number of members that has accompanied this business vision.In 2003 we had 45,000 members. on the platform, which was a good start, mainly in the Silicon Valley environment, and 20 years later we passed 930 million “globally”.
Twenty years ago, the social network was set up as a digital platform that hosted professional profiles that connected with each other. Over time, LinkedIn has become a marketplace knowledge, in which “professionals and companies offer value through content,” explains Sáenz de Cenzano.
“This has also encouraged companies to be more present, to understand our network as a reliable and safe place in which to display their brand and philosophy,” says the CEO of LinkedIn Spain and Portugal.
These changes have occurred in parallel with changes in LinkedIn’s economic situation and corporate direction. A turning point came in 2007 when Reid Hoffmanwho had served as CEO since the company’s founding, He gave up his place to Dan Nyean executive who came from the business software firm Intuit. The LinkedIn co-founder returned to the CEO role in late 2008 but eventually handed over to Jeff Weiner, a former Yahoo employee.
In 2011, Weiner managed to launch the company on the stock exchange, thus becoming the first social network to make this important leap. However, In 2016, LinkedIn shares fell by more than 40% after a presentation of results that fell well short of Wall Street’s forecasts. The organization lost 11 billion dollars in a single day and was eventually acquired by Microsoft.
The skills force a change of mentality
“Since 2016 the company has joined Microsoftwhich gives it technological capabilities, solvency and ample size,” says Sáenz de Cenzano, referring to the purchase of Microsoft, which until recently had established itself as the largest technology deal in history.
The head of LinkedIn Spain also refers to the purchase of Lynda.com, a digital learning website that the social network acquired at that time. “The platform is also a place where professionals want to grow in knowledge and skills,” says Sáenz de Cenzano, referring to the integration of this type of services.
These corporate moves pose all kinds of challenges, especially considering that LinkedIn’s growth to date has been exponential.We add 3 new members every second (…) and we aim to cross the 1 billion mark by the end of this year, early 2024,” said the CEO.
“The platform is vibrant and lives and grows through its members and companies,” says Sáenz de Cenzano. “We energize it, we try to offer services, functionalities, capabilities, but in the end it is a professional social network, with professional content, but with a social character, where its members are those who have the capacity to provide that value.”
In that sense, the executive argues, One of the main challenges they face today It is the change of mentality that implies going from valuing workers according to their academic training and professional experience to valuing them based on their personal or professional abilities. skills.
“It’s the way to help companies find the talent they are struggling to find now,” he says. “In the end, if we don’t limit ourselves to parameters that are already characteristic of the past career, but to possibilities of capabilities and future contribution, we open up those professional possibilities in a much more decisive way.”
Another challenge that the CEO identifies is transversalitythat is, to ensure that the platform includes professionals who do not belong to the sectors that have always been on LinkedIn (such as technology). “Agriculture, healthcare, the audiovisual sector, the world of sport… Sectors that have been less represented are now beginning to find a place where they can fulfil their objectives.”
“We have been investing in AI capabilities for a long time; now it has become more present in the conversation”
With respect to The future challenges facing LinkedIn on its twentieth anniversary, roughly speaking Two can be identified: the proliferation of fake accounts and the rise of generative artificial intelligence.
Business Insider Spain It was already confirmed a few months ago that there were a number of fake profiles on the social network that were trying to scam the more than 52 million employees who search for jobs on LinkedIn every weekThe company may be testing an account verification system to try to alleviate this problem, but it remains to be seen how this will be resolved.
“It’s a constant battle,” says Sáenz de Cenzano. “I wouldn’t even call it a battle, it’s just doing our job. Our job is to curate the content of the network and to clean up any possible imperfections in the form of fake profiles, duplicate profiles… even outdated profiles. (…)”
The executive points out that they have a lot of technology that helps them identify “these imperfections.” He also argues that they do not outsource this work, but rather take responsibility “from start to finish.” “Like any other platform, we are exposed to all kinds of attacks and activities of this type and, honestly, we do not expect them to stop.”
Even so, they do not consider charging users for providing them with an account verification systemas companies like Twitter or Meta (Facebook’s parent company) have announced. “We do the verification de facto“That is to say, our accounts are not anonymous, they are nominal, so any account that we understand and detect is not real, that a person does not respond, we delete it.”
In relation to the challenge that may be more important for LinkedIn in the futurethe arrival of artificial intelligence, the CEO of LinkedIn Spain and Portugal maintains that “now is when there is more talk about it”, but not when they are betting on it the most. “We have been betting on the capabilities of AI for a long time, what happens is that now it has become more present in the conversation.”
Sáenz de Cenzano explains that they have always needed a good algorithm to offer relevant content to users and relevant candidates to companies. “Obviously, the milestone of the integration of the Microsoft group in 2016 gave us a capacity to access technology that was even greater than what we had before,” he points out.
In recent weeks, LinkedIn has presented a series of artificial intelligence tools that will allow the user, for example, Automatically generate a personal description based on the skills and abilities that stand out most in your profile.
“We have launched these functionalities and we will continue to launch more. We are very aware that AI has been changing the way we provide our services for some time and will continue to do so,” says the executive. “These next 2 or 3 years will be the start of the massive use of artificial intelligence and, from there, we will see which ones our members require and we will try to include them.”
After 20 years, LinkedIn is committed to continuing to fulfill its original vision and mission: “Our vision of generating opportunities and our mission of connecting professionals.” “From there, we are going to be pioneers in the type of services and capabilities that we are going to give to our members and our clients in the form of companies,” concludes the CEO of LinkedIn.