LinkedIn CEO Jeff Weiner cautions start-ups on overseas listing

MUMBAI: Professional-networking site LinkedIn has become a lightning rod for Indian start-ups looking for an overseas listing as a means of exit for investors. LinkedIn's shares rose some 109% on day 1 of its listing on 19 May last year and after losing some ground have nearly doubled in the past five months.

However, 42-year Jeff Weiner, the chief executive of LinkedIn has some sobering advice for start-ups over anxious to go down this road. He thinks companies need to wait until they are ready, rather push through a listing on market or competitive pressure,

A company needs to have a clearly defined value proposition, a defensible competitive advantage, defined business model and profitability or a path to profitability all need to be factored in while planning such an issue. "Entrepreneurs must recognise that the IPO is only a stepping stone to reaching the long-term goals of the company," Weiner contends.

The challenge for start-ups, according to Weiner, is to manage the breathless growth they experience in the early years and the subsequent temptation to cash out prematurely. "Managing a hyper-growth start-up is like putting a rocket into space," says Weiner. "If you're even off by inches at launch time, you'll be off by miles in space" His sage advice: Invest in focus (of your business), build a strong team, define the core of your company and don't stray too far from it. "Fewer things done better will give you a greater chance of success."