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LinkedIn – the Lonely Explorer

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LinkedIn – the Lonely Explorer

36Kr,

5 min read
5 take-aways
Audio & text

What's inside?

Many businesses trying to compete in China fell by the wayside. Why is LinkedIn still standing?

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Editorial Rating

7

Qualities

  • Analytical
  • Applicable
  • Concrete Examples

Recommendation

American-based LinkedIn often has been cited as the only high-profile, foreign Internet business to have made it in China. The platform offers something Chinese people covet but can’t access through local competitors: connections to highly reputable companies and universities in the West. However, LinkedIn also seems to have gotten some things about the Chinese market right. Chinese tech media website 36Kr’s entrepreneurship reporter Chen Chen explains LinkedIn’s successful localization strategy. However, on June 23rd, 2017, LinkedIn China CEO Shen Boyang announced that he will be leaving the company. Insiders say that after Microsoft took over, executives decided not to renew his contract. Some experts whisper that LinkedIn China may be falling short of expectations. Chitu, in particular, faltered against domestic competitors despite LinkedIn’s considerable investment in the product. Chen ends his article in a cautionary note: The question he can’t answer is whether Linkedin China’s success will continue. Time will tell. Meanwhile, getAbstract recommends this article to corporate executives and business managers who are thinking about entering the Chinese market.

Summary

US-based LinkedIn already had four million Chinese users when it officially launched its Chinese site in 2014. Since then, LinkedIn China has grown its user base to 32 million, attracted more than 1,000 corporate clients. Today, it earns healthy annual revenues. LinkedIn’s organizational structure, localization strategy and business model have kept the company strong while other foreign enterprises (including Yahoo, eBay, Google, Groupon and – most recently – Uber) have all lost their footing in China.

Censorship and government regulations are stumbling blocks for many companies. Also, if the parent company holds too much control over the China branch, reactions are delayed, decision-making power is limited and execution is slow. In contrast, LinkedIn initially set up its China subsidiary to run like a local start-up. It began as a joint venture with the influential investment firms Sequoia Capital...

About the Author

Chen Chen is a staff writer for 36Kr, a leading tech media website in China that provides reports on businesses and start-ups.  

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