Started with just 500 members in November 2003 in Germany, XING, formerly known as the Open Business Platform, has grown to be the leading business networking site in Europe, and the second site in the world after US-based LinkedIn, which has 20 million members.
“I’m a connector by birth” says Lars Hinrichs, CEO and founder of XING. Speaking to Sunday’s Zaman, Hinrichs explains his passion for personal interaction. “I love introducing people to each other and getting them excited about my ideas,” he notes, adding, “The idea of making the contacts of my friends and acquaintances visible to everyone, and to allow this capital to benefit everyone involved -- that’s the idea that led me to found XING”
A sine quo non for businessmen
In a short period of time XING has become a global business network that professionals are addicted to. Available in 16 languages, with members in over 190 countries and boasting easy contact-management tools, it helps people promote their business career. Hakan Beydaş represents a typical Turkish user. Introduced to XING in April 2007, Beydaş has started to reap the rewards of expanding his business portfolio. “I can’t do without it,” says Beydaş, who runs a successful food import-export business.
“It took me about six months to figure out the network business in XING,” he adds, noting that “I have been doing business from China to Europe for some time thanks to this networking opportunity.” Beydaş is one of millions who have merged business networking with social networking, as the groups in XING have social gatherings online or in person from time to time. “I try not miss social occasions,” Beydaş says.
XING runs a subscription-based, scaleable business model, complemented by revenues from e-commerce and advertising. Members connect to each other using the platform to find decision makers and new sales channels fast, and they are able to reach representatives of thousands of companies. The site has both free and premium-fee-based subscription levels. Hinrichs stresses: “Our members tell us that they use XING as a daily business tool: on average, 92 percent of premium members are active on the platform every month. Four-hundred-and-twenty-thousand members choose to pay for XING Premium Membership.” He adds, “No social network in the world has as high a percentage of paying members.”
Though it claims only a quarter of the subscription LinkedIn enjoys, XING seems to have the edge in terms of quality and content. According to a survey titled “Communication and Networking on the Internet 2007,” two-thirds of those polled have made at least one business contact via the XING platform, and one in five generated new businesses through the site. Its members spend far more hours on XING site compared to LinkedIn. “I spend at least two hours every day on the site,” says Beydas, who has capitalized on his membership by striking lucrative deals.
XING is also very strict when it comes to privacy and protecting membership information. Hinrichs explains that members value the network because they know “we’re serious about protecting their personal data.” That’s not always the case with all Web sites today. “We uphold the strict German and European data protection laws,” Hinrichs emphasizes.
The networking guru says he was inspired by Malcolm Gladwell’s book, “The Tipping Point” -- about how small events can have a large effect -- and claims the future looks good for business networking. According to Hinrichs, social networks -- and business networks in particular -- have the potential to supersede other existing portals, becoming a gateway to the Internet for millions of people. He states that “it is ostensibly more important for people to know what their contacts are doing than to follow the latest news events from around the world.”
XING is continuously updating its portfolio by offering new innovative tools in an effort to stay competitive and attract more members. It has created enhanced functionality designed to make professional life more efficient and productive and already offers two mobile solutions for professionals on the move.
Growing potential of a growing economy
The site is investing in developing markets to expand its membership base. Hakan Gönenli, country manager for XING in Turkey, explains that they have tremendous opportunity and growth potential here. He tells Sunday’s Zaman, “We see a great deal of potential in business connections that emerge between emerging markets like Turkey and other industrial countries -- it’s here that we see our role with XING.” The company uses two strategies in expanding into new markets. It can take the form of a joint venture, as has been the case in China since 2005, or acquisition, as in Turkey.
Gönenli points out that “in Turkey, we want to grow our leading market position as a result of regional teams and cultural affinity.” He adds: “The organic growth we’ve had up until now has been complemented by the acquisition of cember.net in January 2008 with 280,000 members. Positive growth via word-of-mouth is still very much in effect.”
XING and other business networking sites are responding to a changing business environment in a dramatic reshaping of the world by fast-paced globalization. Long gone are the days when people stayed working at the same company for their entire careers. Nowadays, professionals switch jobs every few years or work for more than one employer at a time. “Flexibility and mobility are central tenets these days,” states Hinrichs. “The more dispersed and decentralized working life is structured, the more important social capital becomes in the form of contacts and networks like XING,” he adds.