So, back in June, Microsoft bought LinkedIn for £21 Billion…
As you do, right?
Now, the reasoning behind this, as far as I can see, is basically gambling… except with more than a few chips!
It would appear that, after failing to buy Facebook around a decade ago, Microsoft went after the next best thing… LinkedIn.
“Why would they pay so much?”
Good question. Well the answer is many fold but basically;
Microsoft is not interested in the company itself, more the users of the company, and with over 400 million users that is quite a substantial stake.
“Why would Microsoft be so interested in users?”
Simple, and I will put it right here;
As with all the major online social platforms, which originally started out as innocent fledglings of the internet a decade ago, they have transformed into the biggest advertising platforms around.
What the original creators or FaceBook, Twitter & LinkedIn etc all had in mind was the same thing… they just waited a while until they sprung it on you. In my opinion it was nothing short of genius to be honest. It’s like those counters at the checkout till at supermarkets with all the sweets stacked up whispering sweet nothings into your ear, eventually someone buys something, and that’s how it works.
Microsoft paid the owners of LinkedIn £162 a share, which is a 50 percent premium on LinkedIn’s £108 closing price just before the settlement.
Since July of last year, LinkedIn’s stock had been down more than 43% , with little reason to think it would come back anytime soon.
Infact, back in 2015 their shares were around the £220 mark.
So it was a gamble, a BIG gamble!
Luckily for them, it appears to be paying off as they (LinkedIn) is growing again.
So, when I say social media advertising is one of your best approaches, don’t just take my word for it… apparently Microsoft think it’s so big that their willing to spend £21 Billion on it!
Sleep easy :oP