Few Internet entrepreneurs practise what they preach as devoutly as LinkedIn Corp. co-founder Reid Hoffman, whose business revolves around his belief that good fortune flows from good relationships.
Hoffman, 40, has put that principle to work by mining his own vast network of Silicon Valley connections to rake in one Internet jackpot after another.
A college friendship led Hoffman to PayPal and his first windfall when EBay Inc. bought the online payment service for $1.5 billion US in 2002. Since then, he has become even wealthier by investing in other Internet startups he discovered through friends and former colleagues.
Along the way, Hoffman also used some of his PayPal proceeds to help start LinkedIn, an online business-networking service that helps professionals like him realize the value of their contacts from the past and present.
With more than one million people joining each month and projected 2008 revenue of $75 million to $100 million, LinkedIn Corp. seems likely to deliver another big payoff for Hoffman.
“LinkedIn is a great expression of who Reid is,” said John Lilly, chief executive of the Firefox web browser maker, Mozilla Corp., where Hoffman sits on the board of directors.
LinkedIn tries to help people who know each other elsewhere more easily meet others who might help their careers. For example, if Mary and Bob are both part of Fred’s online network, Mary could ask Fred for a referral to Bob, who could then decide whether he wanted to embrace a new relationship with Mary.
LinkedIn’s focus on professional networking distinguishes it from social playgrounds like Facebook and News Corp.’s MySpace, where users are encouraged to share their personal lives.
Although it may not sound as much fun, LinkedIn appears to be thriving. About 18 million people now have profiles on the site, roughly twice as many as a year ago.