It?s not what you know, but who you know. That is the ethos of successful people the world over: ?who you know? gets your car fixed for cheap and your foot in the door for your dream job.
Now ?who you know? could be about to crush job search website Seek (ASX: SEK) as professional online network LinkedIn (NYSE: LNKD) becomes increasingly used as a go-to source for both employers and job hunters.
LinkedIn celebrated its tenth birthday earlier this month and continues to grow rapidly. But it is the company?s Talent Solutions division that is starting to emerge as a huge…
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It’s not what you know, but who you know. That is the ethos of successful people the world over: ‘who you know’ gets your car fixed for cheap and your foot in the door for your dream job.
Now ‘who you know’ could be about to crush job search website Seek (ASX: SEK) as professional online network LinkedIn (NYSE: LNKD) becomes increasingly used as a go-to source for both employers and job hunters.
LinkedIn celebrated its tenth birthday earlier this month and continues to grow rapidly. But it is the company’s Talent Solutions division that is starting to emerge as a huge potential competitor to Seek and fellow job-listing sites like Trademe (ASX: TME) through its ease of use and the site’s networking power.
Why LinkedIn is different
While Seek faces aggressive website competition in the domestic and international markets it operates in, most are smaller in scale or imitators with less reach. LinkedIn is different because it is truly global in scope and leverages its users’ existing profile and connections to target them with jobs suitable to their experience.
It also allows employers to take more control of the process and actively identify potential candidates before having to advertise the role, with profiles acting as online CVs, identifying candidate’s skills and work history. Conversely, job hunters from all over the world can quickly visit the page of their dream company, view available roles and make enquiries.
Revenue from LinkedIn’s Talent Solutions grew 80% the first quarter of 2013 and represented 57% of the company’s total revenue, up from 54% in 2012. In dollar terms, that’s US$184.3 million. Seek, for its part, took home total first-half 2013 revenues of $326.7 million across the group.
There is no doubting Seek is a strong company with management actively attempting to build the size of the company through international acquisitions like China’s Zhaopin. However the business model presented by LinkedIn is engaging, efficient and offers good value to those on both sides of the employment equation. It would be my first port of call if I were in the job market and may well be where you find your next job.
As economies stabilize and more vacancies start to emerge, Seek could see organic growth slowing if LinkedIn continues to focus on developing its Talent Solutions segment. With a share price up 60% in the last year, investors will need to decide if Seek can deliver on long-term growth.
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