Why Is LinkedIn So Valuable?

I read an interesting post from Stefan and Cory here.

They and other Bloggers seem suprised at the valuation of 250M for LinkedIn.

I am not surprised at all.

Lets do some of the math.
If you are placing a 75K employee.
How much is LinkedIn worth to you? A 1,000 seems reasonable and lets say you land 5 placements a year.
That means you are willing to spend 5000 a year on Linkedin.

Lets say there are 10,000 headhunters/companies willing to do that.

Therefore 10,000 x 5,000 = 50,000,000 in annual revenue and thats just the placement market.

Most Bloggers only focus on one small part of the value of LinkedIn.

In their post Stefan and Cory speak about the cool aspects of LinkedIn and focus on the Job hunting.

While I am always happy to hear that people have discovered the value of LinkedIn. I am surprised at the limitations they put on it.

The finding a job part of LinkedIn is one of the things that make it useful which is what Stefan and Cory focused on.

But, if you are not looking for a job – then why bother with LinkedIn?

Here are just some of my thoughts on why LinkedIn is useful.

1. If you are looking to sell a product – LinkedIn provides you a whole ton of potential contacts. Their profile tells you what they think is important and why. Therefore, if you a good sales person – you can prepare a good presentation tailored to the clients needs.
2. If you are looking to sell a company – you can identify a whole number of potential merger or purchase partners.
3. For example, I have a manufacturing client who wishes to sell his business here in Ontario and now I am discussing a purchase with people located in China and the United States.
4. If you are looking to hire somebody – you have a whole description of who they are are and what they think.
5. If you are looking to solve a problem – LinkedIn provides a very detailed description of potential people you can contact to discuss the problem. Sort of Napoleon Hill’s mastermind on steroids.
6. If you are moving to a new city – there are a whole ton of people who have said – come and meet me. What a wonderful way to start a new move. I was asked by a fellow in California if I would introduce him to my contacts in Dallas. I said yes of course.
7. If you want to export/import a product – LinkedIn provides you contacts all around the world. For example – somebody contacted me about exporting carpets from the Ukraine into Canada.
8. If you are looking to hire somebody – LinkedIn provides you a list of contacts who may know other contacts to start your search. For example – I was able to help a fellow in England find a CFO located in Israel for a company owned in the US.

I think this gives you just a smattering of what LinkedIn could be used for.

And these are just the things I have discovered.

Take Care

Zale

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