The Globalization Club at The Harvard Business School hosted its first speaker of the academic year, Konstantin Guericke, Co-Founder and VP of Marketing of LinkedIn, on Wednesday, October 4.
Konstantin Guericke addressed a crowd of students and interested members of the community on the topics of networking, its importance in today’s business environment, and how LinkedIn is improving the way we network.
Mr. Guericke has extensive experience in sales and marketing with technology firms such as Presenter, Black Sun Interactive, and Caligari. He also spent time at Beresford Partners, where Guericke helped the CEOs of over two dozen high-tech startups develop their positioning and marketing strategy. Guericke currently advises several VC-backed consumer Internet startups on product strategy and viral marketing.
Guericke began with a presentation on the art of managing relationships, where he stated, “It’s not what you know, or who you know, but who your contacts know.” He continued, “that is the reason why people choose to work at certain places, or work so hard to go to HBS.” Guericke also stressed the importance of managing one’s network and nurturing existing relationships, “You need to build on existing relationships first. The best way to do this is by taking action whether it involves helping them get a job, or helping them get access to key information. These types of actions will nurture the relationship for a long time.” Through LinkedIn, Guericke believes the tasks of managing relationships, expanding one’s network and identifying target contacts have become much easier. However, he notes that it still takes work, commitment and the personal touch is just as important.
After concluding the brief presentation, Guericke took several questions from the crowd which allowed him to delve deeper into the LinkedIn business model. Guericke noted “diversity is a good thing” referring to LinkedIn’s multiple revenue streams which include subscriptions for premium accounts, advertising, and transactions. He continued, “This usually is not a good strategy but it acts as insurance and the best way to monetize different activities that LinkedIn offers.” The paying LinkedIn customers include hedge funds, recruiters, investment researches, and management consultants, all paying as much as $3000 per year for a premium subscription to LinkedIn to have access to the right people. An example he shared was a hedge fund interested in finding an executive who recently left a firm that it was evaluating. Guericke concluded, “Before, it used to be a difficult and time consuming effort, LinkedIn makes it a smooth, efficient process.” There are also lower-end subscribers who pay around $20/month for help in their job hunt, or in conducting simple competitive intelligence research.
Guericke also gave the audience specific advice on how to maximize their LinkedIn experience. He suggested students view it as part of molding their brand equity. “LinkedIn helps build your brand by showing what you’ve done and who you are connected to.” However, he also cautions that there are 7.5 million people on LinkedIn (as well as 80% of HBS students), so there is a lot of competition. One way to differentiate yourself is through recommendations from peers, but you need to give recommendations to get recommendations. The easiest route to securing recommendations is to offer a recommendation without a request. He also advised the audience to be candid, “If you are consistent and candid, people will reciprocate with you.” Guericke also warned the audience that LinkedIn’s tremendous scale produces some risk, every-coworker you’ve ever worked with is a potential reference, as you are for them. He did temper it by suggesting that employers and those seeking references will adjust their expectations and recalibrate how they view references overtime.
LinkedIn is also a great way to analyze one’s career goals. By looking at the backgrounds and paths taken by people in your dream roles, it allows you to see how you can get there. LinkedIn also helps students research people who will interview them by getting their background and story, which allows the applicant to be more confident and relaxed. Another potential application is to scout a new role before actually starting. Talking to current and past employees provides great insights into the working environment.
The prospects for LinkedIn look very promising. The company continues to add users at a tremendous rate with the last half million users joining in the last thirty-nine days. LinkedIn has very U.S. centric roots, but is now expanding globally. The U.S. accounts for only a third of new users added, while Europe is another third, and Asia is a sixth. Guericke concluded by stating “the world has become a much smaller place indeed and it is shrinking by the minute.” LinkedIn is playing a large part by helping users grow their network and in turn “shrink” their world.