Interview with LinkedIn Founder Reid Hoffman

Posted on August 20, 2008 by Ajay Jain
Filed Under Interviews / Leaders, Social Networking / Media |

LinkedIn.com has emerged as the hottest professional networking site on the internet, with over 17 million members at last count and revenues in excess of $100 million annually. Interestingly, India boasts the third highest user base globally after the US and UK.

The LinkedIn community is now being tapped by users for accessing faraway markets, landing dream jobs, raising capital, attracting the best of talent, building corporate brands and more. In fact, it has emerged as the single most important introduction for its members, who use this site to boost their personal brand. Their profile on the site serves as a virtual business card, and a dynamic CV too.

I met the site’s founder and chairman REID HOFFMAN in the latter’s office in the Bay Area in San Francisco, USA recently for an interview. Mr. Hoffman is rated as one of the most influential players in the Silicon Valley, for his record of investing in and setting up companies. A prolific Angel investor, he has invested in over 60 companies including Facebook, Digg, Technorati, Friendster, Ning, Tagged, Flixster and Flickr. When, and if, LinkedIn is sold, it could well be one of the biggest stories of the year with some estimates already valuing it far in excess of a billion dollars.

Excerpts of the interview:

How can individuals leverage a network like LinkedIn for their career growth?
Success in the modern world depends on the real connections you have; the quality of this network and how you effectively leverage it can impact your career growth. You can constantly learn from your network; for someone to believe he or she right and knows everything is hubris. We launched LinkedIn Answers for this purpose only, where members can exchange questions and answers and make new connections with people they would otherwise never get to know.

Being a global site, are users really able to use LinkedIn effectively across borders?
Definitely, and in many different ways. A lot of companies in the developing world do business with the developed world, and these are coming up fast on the learning curve by building relationships with those from the developed world through LinkedIn. We too have put the site to good use for our own needs. When we were deciding on a headquarters for the European market, we asked the LinkedIn community for advice to help us choose one. We got valuable inputs on the issues we can expect to face at the various locations being considered, and on the right place to be at from the human resource point of view.

In all this hype about online networking, where do the good old offline interactions stand?
Ultimately all that matters is how you do business offline; most work is about accomplishing tasks which are done in the real world. What is important is how you use an electronic platform to get the best results in the offline world. Just like we used it to decide upon our European Headquarters. A lot of LinkedIn members organize face to face meets, and we believe these can be valuable for them. But we have left it to individuals to organize these; LinkedIn does not offer a functionality to do so yet.

Some companies are known to have banned LinkedIn in office out of fear of losing scarce, quality people. Are these fears well founded?
There are always some risks of people getting hired away; this will happen anyway. But the benefits of professional networking far outweigh the risks involved. Professionals have to solve problems every week; allowing them to leverage their networks for doing so is always a good idea. And if managements have good relationships with their employees, they can use the networks of the latter to attract people to work for them. As an illustration, what makes Silicon Valley so interesting is the speed at which innovations happen; the talent to do so is never enough within companies, and it is the networks employees have that come in handy when there is a need to get the right person for the right job. We do this all the time.

While you are very strong in developed markets, how do you view the developing ones where you may not yet have a strong presence?
We would ultimately like to be a globally strong professional network, but there are challenges to this. We will need to offer local language support in some countries; we are only in English currently. We need to get the dynamics right, as there can be cultural and technological issues in different regions. Some markets will still be slow to pick up though.

Do you have plans to further expand the market in India?
Despite it being our third biggest market already, I am surprised it has not expanded beyond its current levels yet; after all, there is such a large English speaking population, as well a healthy entrepreneurial environment in India. Hopefully the Indian market will take off to much higher levels as soon as the right eco-system is in place. We are planning some local marketing activities that should help.

If you had to offer any key tips to LinkedIn users when using the site, what would these be?
Connect with only those people you have some knowledge of; you should know them well enough to be able to refer them to others when the need arises. And ensure your profile on the site is complete in all respects. You never know what kind of interesting opportunities may find you. For example, a hedge fund looking for a certain expertise may find it in you.