Last night Techcrunch posted that LinkedIn was laying off 10 percent of their staff. Just a couple weeks ago the company announced that they had raised $22.7 million in a round of funding from SAP Ventures, Goldman Sachs, and McGraw-Hill. At the time it wasn’t clear that the company wasn’t laying people off, simply that they were slowing their hiring process.

Now 10 percent is being chopped. While we may have a new President-Elect, the economic conditions still appear to be worsening for the time being. As such startups are tightening up, cutting back on hiring, and an increasing percentage are reportedly firing anywhere from 5 to 20 percent of their staff. We have no reason to believe that this trend won’t continue.

Just this morning Peter Kafka reported that News Corp is experiencing a softening in their display advertising on MySpace. They are expecting that to continue into the first two quarters of next year. Also this morning, while being interviewed by John Battelle at Web 2.0 Summit, Paul Otellini of Intel suggested that general consensus is the first two or three quarters next year will be hard.

It’s clear that no companies, including social networks, are immune to recessionary pressure. As companies push through the next three quarters, there is a very good chance that we’ll see cutbacks continue.

In today’s spirit of openness, LinkedIn has announced details on the opening of their platform. According to Reid Hoffman, the initial rollout will be focused on “productivity applications that range from gathering information that professionals around you are generating to enhancing your abilities to collaborate and communicate more effectively.” There are currently 9 live applications from Amazon, Box.net, Google, Huddle, Six Apart, SlideShare, Tripit, and Wordpress.

We will be posting more after we get to try out the platform.

In the middle of an economic crisis, LinkedIn has sealed a new round of funding for $22.7 million from SAP Ventures, Goldman Sachs, and McGraw-Hill, according to the Wall Street Journal. This round of funding includes cash from strategic partners and not just venture companies. According to the Wall Street Journal, this round was actually part of the Series-D which was first announced in June.

That leaves the company valued at $1 billion, a far cry from the $15 billion valuation Facebook was able to attract. According to the latest Nielsen ratings released today, LinkedIn has a quarter of the domestic growth that Facebook has and is growing at a much faster rate. According to Dan Nye, who spoke with Techcrunch, the company has been profitable since 2006.

Why would they want this money now? Well they might as well have a nice stash of cash in order to weather the economic downturn. Is the company firing anybody at the company? It doesn’t look like it but the Wall Street Journal has said that the company has definitely slowed down its hiring. Then again, would the company really announced that it’s actively hiring in the face of the recent firing announcements?

For those companies that are cash heavy, this period could turn out to be pretty valuable as they snatch up new employees and potentially entire companies through acquisitions. This is a sizeable round to follow-up from the $53 million raised a few months ago. Looks like we can bet on LinkedIn being around once this economy works through all its issues!

Yesterday afternoon LinkedIn announced that they had launched a new partnership with CNBC. There are a number of implications of the partnership. Dan Nye announced the three main areas:

• Content Syndication on LinkedIn - LinkedIn users will now have access to news from CNBC. This is actually a big win for CNBC and highlights LinkedIn’s knowledge that social networks are increasingly a center for traditional media distribution.
• LinkedIn Community on CNBC.com - Back in July LinkedIn announced that they would begin enabling users to share content from the New York Times. It appears that they have sparked a similar agreement with CNBC. This time around there are no screenshots of how this integration will take place.
• Live LinkedIn Interactions on CNBC - One final point of cooperation between LinkedIn and CNBC is that CNBC will include “survey results and on-air Q&A with CNBC anchors, reporters and guests.” Unfortunately we haven’t been able to see this yet but I have seen live polls on CNBC so this appears to be an additional channel for CNBC to get poll results. Live Q&As sounds interesting but we’d have to see this in practice to understand more.

This sounds like a great partnership for LinkedIn and it highlights the increasing cooperation between social networks and traditional media outlets as both parties try to explore a nascent area in new media.

I spent some time poking around at the new LinkedIn iPhone application this morning and I was fairly impressed. The application is simple but useful. It enables you to browse through your contacts, view your contacts’ latest activity, search for contacts and update your status. Apparently status updates have become ubiquitous across all the social networks making tools like Ping.fm a necessity.

LinkedIn As the Simple CRM

One thing that I find interesting about this services is that it could easily compete with Salesforce. With a few additions, LinkedIn could be the CRM solution for those that don’t know what a CRM solution is. Let me explain. Imagine waking up in the morning to find out that you hadn’t followed up with a recent contact that you added in at least 6 months. Now would probably be a great time to follow-up so the LinkedIn application would automatically alert you.

Want to keep track of that conversation you just had? The call will be automatically noted next to the contact in LinkedIn and you can write a quick note about what you just discussed. While the application doesn’t currently provide these features, it’s something that has been needed for a long time and I have yet to find a simple yet useful contact management system that handles all of my contacts.

Race to My Contacts

The existing solutions are overly complex. One problem with LinkedIn is that when I add a contact, I don’t have a note about how I met that person. For the first time I have found the ability to do so (as “Edit Contact” is currently a beta feature on the site) but when I approve a contact it doesn’t automatically prompt me to enter those details as Facebook does.

I keep saying over and over that the social platform race is a race to my contact list but there still isn’t an effective solution! I currently subscribe to Salesforce.com but paying $55 a month seems like a lot of money to spend on something that isn’t extremely easy to use and offers 10,000 more features than I’ll ever use.

Conclusion

The new LinkedIn iPhone application shows the power of simplicity. It’s not necessary to build a feature heavy application to be successful. LinkedIn has only touched the surface of its potential and given its reach in the professional world, LinkedIn has the potential to become an amazing service that I can’t live without. Unfortunately for LinkedIn, all my contacts are now adding me on Facebook but that’s not to say I’m the average case.

This is a great step and it shows that the company is quick to adapt. Now the company needs to start rolling out new features so that I don’t need to continue relying on SalesForce.com as my overly robust contact management system. If you have an iPhone I highly recommend checking out the LinkedIn application.

Last week LinkedIn launched their company directory which has been in beta for the past few months. They also introduced the ability to search by company based on industry, location and company size. I wrote about the new directory back in March but I didn’t have the chance to browse through the directory. My first search was to find all of the companies based in the “Internet” industry in D.C. The result? 118 companies. I then proceeded to do the same thing for San Francisco and came up with 505 companies! Not extremely shocking but still informative. Here are the number of internet companies in other popular “creative class” cities:

• Atlanta, Georgia - 48
• Austin, Texas - 41
• Boston, Mass - 132
• Chicago, Illinois - 76
• Denver, Colorado - 57
• France (Country) - 196
• London, U.K. - 125
• Los Angeles, California - 246
• Miami, Florida - 33
• New York, New York - 306
• Phoenix, Arizona - 21
• San Francisco, CA - 505
• Seattle, Washington - 84
• Washington, D.C. - 118

How accurate is this calculation? Not very accurate because in the United States, the total number of companies claiming the “Internet” industry only amount to 2,323 which is far less than I would imagine actually exist. Then again, LinkedIn was extremely accurate with the companies based in Washington, D.C. so there is a good chance that this is a pretty good indicator.

The directory couldn’t find my own company though (Social Times Inc.) which has been classified as an “Internet” company. There were also other companies missing but so far this is the most accurate directory I have found for “Internet” companies based in the Washington, D.C. area. Take a look around the LinkedIn company directory and let us know if you find any problems with it. Do you think this is a useful tool?

Eric Eldon has been pulling sources out of his hat today. The latest one claims that LinkedIn employees have been given a similar agreement to Facebook in which they can sell up to 20 percent of their shares at a $500 million valuation. I’m guessing that a source came out of the woodwork after they saw the earlier story about Facebook letting employees sell their shares.

This is an interesting phenomenon as it has become more challenging for web start-ups to go public. It’s now more challenging to keep the top tier employees working at valley start-ups as the exit period has become extended. Enabling employees to sell some of their shares is supposed to provide employees an incentive to stick around. Unfortunately I don’t have more details on how this plan works

LinkedIn should generate $100 million in revenue this year in comparison to the $300 million that Facebook publicly stated they would generate this year. If you were to value the two companies strictly on revenue, it would appear that Facebook is extremely overvalued even at a $4 billion valuation. The differing valuations could be a result of opportunity cost as well as unknown internal valuations that both the companies produce when filing reports with the SEC.

However this new system works, it is definitely interesting to see employee liquidity opportunities prior to the companies having liquidity events. I’d wonder if it’s only employees and not the venture investors that have an opportunity to sell shares as well. For now, all we know is that this is options for employees according to Eric Eldon’s sources.

While I was busy traveling around the country last week, LinkedIn was busy announcing new partnerships and new features. On Monday LinkedIn announced that they would be partnering with the New York Times. Their partnership enables two new features: the ability to receive targeted news headlines and the addition of LinkedIn to the Times’ share feature.

The targeting of articles is based on your profile information that you’ve entered on LinkedIn. The primary source of information is your industry. Once activated, you will see up to five articles that are relevant to your industry as embedded as illustrated below:

Unfortunately I haven’t tested out the new feature so I can’t tell you how well it works but the concept of targeted news is not a foreign one. For example the Seen This application on Facebook, enables users to find news relevant to them based on what their friends are reading. This is a big partnership for LinkedIn though as it could also help increase the number of new user registrations.

Last week LinkedIn also announced that they would begin offering the site in Spanish. This is the first new language that the site has launched in. In comparison to other social networks, LinkedIn has been relatively slow on the foreign language front. Both Facebook and MySpace have launched in multiple languages. Thanks to Facebook’s translations application, the site has been translated into 15 languages to date.

Finally, LinkedIn announced that they will begin integrating with Xobni, which has been hailed as the most useful email add-on, and LexisNexis. The partnership with Xobni emphasizes something I was discussing almost two weeks ago: the social platform race is really a race to my contact list. The faster that these companies can make my contact list accessible anywhere, the faster that they make my reliance on them as a service more critical.

While the Facebook news last week may have quieted some of LinkedIn’s buzz, the new partnerships did not go unheard. LinkedIn is still clearly one of the primary competitors in the social platform wars. Last week’s announcements by the company emphasizes their continued dedication to rapid expansion.

Last week LinkedIn quietly launched their new LinkedIn Direct Ads service. LinkedIn Direct Ads is a similar service to that which is currently offered by Facebook via their SocialAds program. LinkedIn’s offering targets based on age, gender, industry, and seniority of ad viewers. As pictured in the image below, advertisements show up above the fold. Additionally, these advertisements are currently limited to the United States.

One thing that was substantially different from SocialAds is that the owner of advertisements is displayed next to ads. As the Direct Ads documentation reads, “LinkedIn DirectAds feature your name and a link to your LinkedIn profile on advertisements that you purchase. We want to provide LinkedIn members who view your advertisement with as much transparency and visibility into the advertiser as is appropriate for our community.”

Currently the minimum order for advertisement purchases is $25 and it appears that ads are charged based on a CPM model (cost per thousand impressions). While there has been no test of the advertisements run on this system versus Facebook Ads, this systems has been positioned as a direct competitor. I’m not so sure that the CPM model will wok in the long run though.

Thanks to Rob Webb for the heads up.

LinkedIn has raised $53 million from Bain Capital Ventures giving the company a $1 billion valuation. The company has experienced massive growth over the past year. 319 percent to be exact according to statistics released in April. While the company is a fraction of the size of Facebook, the company has an extremely targeted user base with high average household incomes and a higher median age then most of the large social networks.

A good analogy would be that LinkedIn is the Wall Street Journal of social networks. There’s no clear path for LinkedIn from here but there is a lot of buzz surrounding their soon to be released platform which is expected to attract the attention of premium brands. LinkedIn has now raised a total of $80 million. Don’t expect them to start selling virtual goods anytime soon though.

LinkedIn appears to be focused on building out their rapidly expanding user base. There had been substantial speculation that the company would get acquired by News Corp to integrate into the Wall Street Journal. Based on the recent round of financing any partnership between the two companies will most likely be delayed.

The social networking space continues to heat up with new rounds of financing by the industry leaders. It will be interesting to see how this all transforms over the next 6 to 12 months as the focus shifts to cross-platform communication and integration. Oh and lets not forget monetization.