Shaky economy drives users to LinkedIn

Venture Beat — Thu, 02 Oct 2008 11:06:13 -0700

When it comes to the current financial crisis, not everyone is suffering equally. In fact, professional networking site LinkedIn has gotten a boost from the bad times — unemployment, or the threat of unemployment, is sending many new users to the site.

Not surprisingly, a lot of that boost comes from the financial sector, where many venerable institutions recently collapsed. LinkedIn says new member sign-ups from the investment banking industry have more than doubled in the last seven weeks, and the total number of financial industry members has increased by almost much.

Here are some stats from the week of Sept. 7, which is the most recent data LinkedIn provided:

50 percent increase in site usage by financial industry members
14 percent increase in recommendations
10 percent increase in invitations sent
7 percent increase in sign-ups
9 percent increase in page views
11 percent increase in the number of connections being made

LinkedIn tells us that some new members are joining because they’ve been laid off, but others are just worried about the general economic climate and the impact it could have on their jobs and their finances. Those users joined LinkedIn “just in case.” This data reinforces some common-sense advice that VentureBeat writer Dean Takahashi gave in a post about how startups can survive a downturn: Companies should provide a service or product people need even in tough times.

It’s probably not all silver-lining for Mountain View, Calif.-based LinkedIn, which has been talking about an IPO (albeit without any particular timeframe). The crummy exit market has likely put a damper on any immediate plans. Instead, we hear that LinkedIn is letting employees sell a portion of their vested stock options early. So the company’s executives and investors may not be thrilled about the economic climate, but at least they’re seeing some benefit.

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Shaky economy drives users to LinkedIn