LinkedIn Has a Signaling Problem
Today I had an interesting (brief) conversation with Semil Shah on Twitter, which led me to what I’m about to write. In the technology industry, and Silicon Valley more specifically, it’s hard to deny the importance of LinkedIn. I do believe that others are right in their negativity against the company — a lot of areas need improvement, which I’ll touch on — but the company has definitely made Wall Street a little less wary of internet IPOs. The company has a whopping $28 billion market cap, and it’s stock price has increased 134% over the past year; that’s fantastic in many respects. It creates more liquidity for employees, which means more money going back into the flame that is the Silicon Valley. It also makes it slightly easier for other tech co’s to go public.
On the contrary, there are some significant problems arising for the Mountain View-based company. Put simply in the words of Semil, LinkedIn has branded the resume, but it has an input/signal problem. One perfect example of a terrible signal for prospective job seekers is the LinkedIn “endorsement.” Far from a real endorsement, this feature has turned into a spammy “scratch my back and I’ll scratch yours” feature wherein users click a button to endorse each other for random skills on their profiles. Most of the time the user endorsing somebody for a skill doesn’t even know if the person their endorsing knows anything about that skill in the first place! I get endorsements all the time by people I don’t even know, and that really don’t know me.
This might be going out on a limb, but if I were LinkedIn I’d partner with Klout and use their technology for better signaling. Not to list a Klout score, but to display which topics users are actually talking about on a frequent basis. Wouldn’t it be better to see what I’m ACTUALLY talking about on an active basis, rather than creating a list of random buzzwords? To me it seems like that would be much better signaling, because it shows what your true interests are. Maybe some wouldn’t like this because they don’t like their social lives intertwining with their work lives, but it’s reality now. I’ve found that most startups really like seeing prospective employees that are active in online communities around their interests. I mean, why wouldn’t they? No startup wants to hire somebody that’s just in it for the money. Well, good startups don’t.
There are more areas I could touch on, like connections on LinkedIn which signal essentially nothing, but I won’t. Throughout every interview I’ve been through, my interviewer always came in the room with my LinkedIn resume printed out (really like that LinkedIn has a resume adapted for print). I don’t even know what I would do without LinkedIn. I have never created a resume from scratch in my life, and I surely hope I never have to. LinkedIn is consistent, organized, and accessible. But it needs to sort out these signaling problems. There must be a better way to weed out bad potential hires from good ones, but LinkedIn endorsements and connections aren’t that.
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