Linkedin: The Best Place for Professional Connections
The success story of LinkedIn is connected with the rise of many entrepreneurs, who have revolutionized the way we live, communicate, and conduct business in the last two decades.
The chain of events that culminated with the WWW bubble burst is accredited to the Paypal mafia - a group of geniuses who saw the potential of internet connections and created the foundations of all the services we love and enjoy in today's digital era.
Part of this group of remarkable people was Reid Hoffman, LinkedIn's father. He founded the company that redefined the way we build and maintain both personal and business relationships.
How this tech giant became the godfather of social networks, is a story that gives hope for humanity's future - and we're here to tell it!
Born during the height of the Vietnam war, Reid was just a baby when his parents took him to the largest protests calling for peace, love, and understanding during that period.
Their principles and engagement in protests, along with the counterculture of the 60s defined Reid - his righteousness is what helped him go down a path that nobody could have imagined.
As a kid, Reid loved playing board games, with his favorite being a fantasy role-play game called Runequest Chaosium. He was a super-smart kid filled with all the eagerness in the world, so one day he just waltzed in the offices of the company that made the game and began to annoy the employees with questions and ideas.
Later that year, when they published an idea for a new game in the local newspaper, he took the article, edited it with his own ideas of how to make it better and mailed it to them. They liked it and so, Reid got his first job - at age 12!
In his teenage years, Reid wanted to broaden his horizons, so he decided to go highschool at Putney, a boarding high-school out in the mountains. What drew him there? Their unusual curriculum. Aside from the regular subjects he'd have to study like maths and sciences, he had the chance to study blacksmithing, woodworking, and similar trade-field subjects.
He got accepted, and in the next four years, he learned that he has a knack for working with people and getting his way. Deal with bullies? Check. Navigate and manage people from different backgrounds? Check. Entrepreneurial spirit? Double-check!
He was a natural at forming and developing relationships, which shaped his persona. His mind was constantly looking for answers to crucial questions regarding interpersonal skills in people: how people are connected, how we find each other, why we trust each other, and how we navigate through life.
Nice Guy Winning
After high school, he went to Stanford, where he enrolled in a brand new student program called Symbolic Systems. The program combined philosophy, programming, logic, psychology, and computer science into one, attracting some of the brightest minds of Reid's generation.
Reid's solid knowledge in philosophy, easy-going attitude, and kindness, allowed him to quickly become friends with everyone and create a personal network of people willing to revolutionize humanity. During his studies at Stanford, Reid became friends with Peter Thiel. Their relationship and future collaborations would help create many billionaires and even more millionaires, but most importantly - change the world!
Reid understood entrepreneurship and software, but still wanted to help develop and refine his ideas on how people should interact through academia. So, he went to Oxford.
After 6 months in the UK, he learned that the effect of academia was limited to certain layers of society, while Reid was looking at something that could make an impact with the general population. He wanted to know how to take his ideas and to bring them to the masses, so he called his friend Heck for advice. Heck laid it out plain and simple: go and work for Apple!
Diving Into the Tech World
Reid joined tech giant Apple in 1994 - during the company's dark ages. He started working on an eWorld, Apple's failing social platform that almost nobody used. The concept ultimately failed, but Reid realized that the idea could be very successful if improved, upgraded, and most importantly - specialized for business!
Armed with an idea and ironclad willpower, Reid was ready to venture into the world of business. In 1997, he co-founded SocialNet, a website that allowed people with common interests to connect and exchange ideas through the internet.
His ability to understand 'network effects' before they had a name, made SocialNet a big success, with people using it for dating, sports, fantasy games, and so on.
Through SocialNet, Reid realized that people want to use the internet not as a tool, but as a place - a place that directly affects their real lives and relationships, one that would help people live better on both personal and professional levels.
Joining the Paypal Mafia
During this period, small tablets called PalmPilot were released into instant popularity, and Peter Thiel began working on an idea - utilizing tablets for mobile payments.
Peter called Reid with a job offer, which the latter accepted only because of their friendship.
After they developed and put the mobile payment system online, a barely-known internet company at the time called 'eBay' began using it. Reid saw the boundless potential of internet payment and went to Peter, urging him to shift the company focus from mobile to internet. Peter agreed and made the change, and from then on, the company started to grow exponentially, chugging along the road to becoming the Paypal we know today.
During his time in Paypal Reid was called 'the wolf' or 'the fixer'. Problems with eBay? Fixed. Credit card giant Visa tries to shut them down? Bite them right back! He even managed to persuade the federal government that Paypal wasn't a bank - and that it was okay!
During this time, the myth of the Paypal Mafia started to form, a dream team of entrepreneurs consisting of Reid Hoffman, Peter Thiel, Elon Musk, Steve Chen, and others. This amazing group of geniuses made Paypal so popular, that shortly after PayPal's IPO, the company was acquired by eBay on October 3, 2002 for $1.5 billion, making all of them millionaires.
The Mafia then disbanded, with every single one of them going their own way. Their personal venture ideas have given birth to tech giants, such as Tesla, Inc., LinkedIn, Palantir Technologies, SpaceX, Square, Slide, YouTube, and Yelp.
LinkedIn: From Idea to Reality
Reid was planning to cash the fat check he got from PayPal's sale and go on a long vacation, but the Silicon Valley boom made him reconsider his priorities. He canceled his vacation plans and immediately dove back into business with his lifelong dream - bringing people together by redefining how social and business connections were made.
Seeing that intelligent and capable people around the world have problems connecting and collaborating, Reid founded LinkedIn in December 2002.
Scaling and reaching critical mass is no easy fit for any business, and LinkedIn struggled in the first four years too. However, Reid knew that fast-growing economies reach a point where business connections, resume exchanges, and reference checking will need to move faster and more efficiently in order for it to keep growing. For Reid, LinkedIn's success wasn't a question of if - just when!
At LinkedIn, the continued work on improving the platform paid off, and when the company made the initial public offering in January 2011, with shares priced at $45 a piece. In the first day on the New York Stock Exchange, LinkedIn's price skyrocketed to more than 171% of the initial asking price, closing at $94.25, more than 109% above the initial share price.
Conquering the World
Going public launched LinkedIn into stardom. The company ended 2011 with $154.6 million in advertising revenue alone, surpassing Twitter, which raked in $139.5 million.
Meanwhile, Reid was constantly on the lookout for the next big thing, helping build new startups, like Facebook and Spotify. People called him the godfather of social networks, because of his golden touch, every company he worked for or with ended up becoming a giant in their field.
LinkedIn kept growing until 2016, when after a low earnings report, it's shares dropped by 43%. A couple of months later, Microsoft bought the company for $26.2 billion - their largest acquisition to date.
Getting in bed with Microsoft was good for LinkedIn, especially since they shared the same goal - making organisations more productive, and the world a better place!
With its 403 million users in 2017, the company began communicating closely with both private organisations and individuals, looking for ways to help them develop and evolve. The platform gives entrepreneurs the ability to research competition, recruit talent, make sales, or just exchange ideas.
That's what allowed LinkedIn to reach 700 million users in 2020.
With COVID-19 rampaging throughout the world, and people having to stay at home, LinkedIn's services are needed now more than ever - kudos again, Reid and Peter!