LinkedIn is more than an online social network, at leastaccording to its founder. It is a force that will help change theworld by encouraging a new attitude toward life planning.
Reid Hoffman, LinkedIn Corp.'s chairman, foresees a future inwhich everybody is an entrepreneur, marketing his or her skills likethe manager of a small business. "When you mirror good lifestrategy," he said, "you actually mirror what entrepreneurs do."With a net worth approaching $2 billion, Hoffman is perhaps theworld's wealthiest philosopher. He has a master's degree inphilosophy from Oxford and once hoped to become a full-timeintellectual. "I wanted to help strengthen and create publicintellectual culture," he said.
Then he realized his academic work would never change the world."To produce a piece of relevant philosophical work, it was supposedto be scholarly and narrow enough that maybe about 50 people wouldread it," Hoffman said during a lecture yesterday at theMassachusetts Institute of Technology's Media Lab.
"I wanted to make changes on the scope of millions."
So Hoffman went to Silicon Valley instead, and eight years ago,after stints at Apple Inc., Fujitsu Group, and PayPal, he launchedLinkedIn, a business-oriented social network that has attracted 100million members worldwide. The company reflects Hoffman's interestin developing "human ecosystems" - technology-aided networks ofsocial relationships; in the case of LinkedIn, an ecosystem createdaround people's business interactions. Users publish informationabout their career experience and areas of expertise and makemutually beneficial connections.
LinkedIn went public in May, its shares more than doubling invalue from their initial price of $45. Yesterday, JP Morgan, one ofthe investment banks that underwrote the LinkedIn offering, cut itsrating on the stock from "buy" to "neutral," sending shares lower.LinkedIn shares closed at $102.44 yesterday, down 6.85 percent forthe day.
Still, LinkedIn's strong performance, and upcoming offerings fromhot Internet companies such as online game giant Zynga and Internetshopping service Groupon, sparked concern among investors about arepeat of the Internet stock bubble of the late 1990s. It was a timewhen companies rushed into public stock markets, attracting billionsin capital and sending share prices to stratospheric heights. Butmany of these companies collapsed a few years later.
Hoffman said he didn't know whether to expect a new bubble. "Idon't really have a particular view," he said. "I do think thatpeople are excited about the area because it's an area that shows alot of promise for growth . . . whether or not any particular marketvaluation is the right valuation, I leave that to other experts."
But Hoffman himself isn't hesitating to invest in other sociallyoriented Internet companies. He's putting money into airbnb.com, acompany that lets travelers rent rooms in peoples' homes, instead ofstaying in hotels. Hoffman said the site tracks the reputations ofguests and renters to ensure that total strangers can share a housesafely and profitably. It's "something that could make a hugedifference in people's lives," he said.
Hiawatha Bray can be reached at bray@globe.com.
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