Future of LinkedIn:

LinkedIn has some of the smartest investors around. These investors have deep pockets and they are almost certainly following the model of building both scale and deep end user value before attempting too much monetization.

There are signs that they are looking at deepening their service value, specifically by becoming a network to find small service providers. With reputation ratings, that has big value. It has reciprocity as there are times as a buyer when you really need a small, specialist firm at short notice. So this is valuable to buyers as well as sellers. There are specialist networks doing this already, so LinkedIn can do it at scale across multiple domains.

Thinking about monetization, the primary motivations for using a business networking service like LinkedIn:

1. Push marketing. Find the right contacts to avoid cold call. This has limits. Over-use will lead to barriers getting erected to avoid ‘networking spam’. This is true whether one is selling a product, a service or person (e.g. recruiters). This works when it is occasional, uses close contacts only and there is reciprocity in the real world relationship.

2. Pull markerting. Put up your profile, or your firm’s profile, and get found by the right buyers. This is nascent in LinkedIn today but shows big promise.

3. Just-in-time expert advice for cash. This is what companies have done for years and they have built a real business. There are more consumer-oriented variants such as BitWine. With their scale, LinkedIn could easily get into this business.

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