Almost five years ago, Microsoft acquired LinkedIn; despite the various reasons cited as the purpose of the purchase, it is believed that Microsoft wanted to have a social media network for professionals.
In 2016, it was announced that Microsoft had acquired professional networking platform, LinkedIn. The leading technology company reportedly spent an estimated $26.2 billion on the acquisition of LinkedIn. While the price does sound exorbitant, analysts have suggested that Microsoft purchased LinkedIn at a steal, considering the value and the projected value of the company. Although the brand’s net worth cannot be estimated due to the acquisition, the platform has continually grown over the years, with an estimated two new members reportedly signing up every second.
Therefore, when news of the acquisition was made official, Microsoft released a statement which read, “Microsoft’s $26.2-billion acquisition of LinkedIn aimed to grow the professional networking site and integrate it with Microsoft’s enterprise software, such as Office 365. The move allowed Microsoft to reach LinkedIn’s massive user base and put Microsoft’s sales and distribution heft behind what was already the world’s largest and most successful social network. LinkedIn retained its distinct brand and culture — and also its (Chief Executive Officer) CEO, Jeff Weiner, who began reporting to Microsoft CEO Satya Nadella.”
Therefore, the speculated reasons for the acquisition did not veer too far off the reason provided by Microsoft. Analysts have also corroborated the above, and have suggested that the company was looking to grow its reach within the social media sector whilst branching into the professional social media space. Before discussing the why, it is important to note that before the acquisition of LinkedIn, Microsoft had acquired Nokia for $6 billion, and to date, Nokia has not been able to recapture the glory of it heydays.
LinkedIn’s features and user capabilities were already in alignment with some of Microsoft’s offerings. The platform already provided options for members to view articles and other collateral which could be shared. Overall, it acted as a platform for engagement that was not previously available to Microsoft.