Microsoft To Acquire LinkedIn.

The Internet has been abuzz since Microsoft dropped the big announcement: They are set to acquire LinkedIn, for $26.2 billion. This is Microsoft’s biggest acquisition till date and perhaps the most exciting one in recent times. To break it down, Microsoft is paying $196 per share in an all cash transaction and is expected to close at the end of the calendar year. LinkedIn has a reported 433 million users worldwide and is active in over 200 countries. LinkedIn will continue to keep its brand and distinct identity while becoming a part of Microsoft’s business. You can read Satya Nadella’s memo to the company here.

LinkedIn is the social networking platform for professionals. Basically being active on LinkedIn during work hours is not frowned upon, unlike being on Facebook. It’s interesting to note that Microsoft so far hasn’t had a strong foothold in the social networking business, something they are perhaps hoping to fix with this move. This acquisition is in line with their interest in enterprise social networking – remember they acquired Yammer in 2012?

At its very core, LinkedIn makes a major part of its revenues from its Talent Solutions vertical. This business line and its powerful social network for companies provides a ready market for Microsoft to sell some of their products – both software and the little hardware they dabble in. Two of LinkedIn’s acquisitions stand out in making this deal even more lucrative for Microsoft – the recent Lynda – which is in the business of online education, and SlideShare, the content sharing platform. The online education sector is enjoying a steady growth, with more players wanting to get a share in the industry. This combination of Lynda+LinkedIn offers many exciting possibilities for Microsoft. SlideShare, a content discovering and sharing platform falls right in place with Microsoft Office, perhaps one of the most powerful tools available today.

Many Indian origin entrepreneurs contributed to this success of LinkedIn. Here is a list of startups LinkedIn acquired with founders of Indian origin:

• Pulse. Mobile News reading tool, founded by Akshay Kothari and Ankit Gupta as students of Stanford University
• Slideshare. Founded in 2006 by Rashmi Sinha
• Card Munch. Scan and import business cards. Founded in 2009 by Sid Viswanathan, Bowei Gai and Sudeep Yegnashankaran..
• Choice Vendor. Provides ratings and reviews for B2B service providers. Founded in 2008 by Yan-David and Rama Ranganath.
• Connected. A social CRM company founded in 2009 by Sachin Rekhi
• TrustHop. A social talent marketplace, founded in 2010 by Viral Kadakia.

That said, exciting times ahead to see how Microsoft and LinkedIn benefit each other. After the acquisition, LinkedIn CEO, Jeff Weiner will report to Satya Nadella.

What do you think about this move and the price?

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