LinkedIn co-founder tells Stanford students how site became leader in crowded market
When Konstantin Guericke co-founded the business networking Internet property LinkedIn, Inc. in 2002, social networking was still in its infancy. Facebook would not arise until 2004. MySpace and Friendster dominated what, at that point, was a social media landscape muddled by an ever-increasing number of sites, each offering some unique platform and specialty to a growing Internet community.
Speaking in front of a full house in Stanford University’s Bechtel International Center on Tuesday, Guericke discussed the founding of LinkedIn and what has led to the company’s success in a talk titled ‘The LinkedIn Story: Becoming a Go-To in a Crowded Marked.’ Theresa Lina Stevens of the Stanford Technology Ventures Program moderated the event as part of Stanford Entrepreneurship Week.
Guericke, an alumnus of Stanford, served as LinkedIn’s Vice President of Marketing from its founding until 2006, and much of the conversation centered around the viral nature of web-based marketing as opposed to more traditional styles like direct to consumer advertising. Guericke said, “I think the new marketing is much more quantitative because now, if you can track it, it becomes much more of a science.” He added, “On the web, the little improvements make a big difference.”
According to Guericke, one of the greatest hurdles when his company started out was expanding beyond a limited Silicon Valley network.
“Sometimes I would come into the office and wonder where are we growing today because our users are our marketing department,” he said.
Establishing small networks in cities around the country and the world proved key to the eventual success of LinkedIn. Guericke said that because LinkedIn caters to users who are less interested in the social aspects of the site, the growth of the property was slower than other social networks. Today, LinkedIn claims over 90 million members in over 200 different countries and territories worldwide.
Guericke commented that one of the first places LinkedIn saw broad success internationally was in Iceland.
“I think I am responsible for the early explosion of LinkedIn in Iceland because I know this guy, he’s a very accomplished entrepreneur and very connected to music and fashion and all kinds of things,” Guericke said. “I noticed, after I invited him, Iceland started to boom.”
He added, “It’s kind of a small country and I think they only have like six last names in Iceland, so they are very connected there.”
Garnering media attention was also a difficult task for the fledgling social networking site which was founded just after the dot com bust. As Guericke explained, “In 2003, the only reporters who were left were the ones that thought the dot com was a bunch of hooey because the people who got excited about the dot com were laid off.”
He noted, “These were really cranky people, and they said,’your business model is going to be subscription premium membership, and do you know The Wall Street Journal — they tried it for two years, and they just canceled it.’”
In 2010, LinkedIn turned a profit, earning $1.85 million.
Nearly a decade from the time that Guericke, joined by Reid Hoffman, Allen Blue, Jean-Luc Vaillant and Eric Ly, founded the site in Santa Monica, the company, now based in Mountain View, is poised to be the first major social network to go public, which will happen later this year.
Guericke no longer works in an executive capacity for LinkedIn; He maintains a relationship with the site as advisor to their attempts to expand in Germany.