The funniest thing I saw yesterday about the LinkedIn (LNKD) hysteria was this one-liner from Amy Feldman, whom I follow on Twitter; Either I'm using my LinkedIn account wrong or the market is crazy.I thought that was hysterical. In all the excitement yesterday were countless references to the tech bubble and exploration of whether it is coming again this time with social media. I'm not concerned about trying to figure this out because as we have seen this movie before, I know that if there is a glut of these things, the more professional LinkedIn will not offer diversification for a position in Facebook, should it ever list, which is more social, which will not offer diversification for Twitter which is micro blogging, which will not offer diversification for Whereberry which is more aspirational (that one is real, I did not make it up).
There is nothing wrong with buying into the mania, the problems occur when people buy too much of the mania. A couple of percent into one of these things that then goes to zero becomes a lesson-learned. However 30% into a basket of them that blows up (don't snicker, this was very common 11 years ago) means going back to the drawing board with the financial plan. To be clear, I'm with Amy, I have an account that I must not be using correctly.
One item I forgot from yesterday's interview with my neighbor who drives the backhoe. I mentioned he gets a pension that they usually sock away. Part of their strategy is that they have built in the what-if of the pension fund going under. Their life is structured that it would be a nuisance not a game changer.
On a similar note I've previously disclosed being laid off from Schwab in September 2001 (that's right). I knew over a year ahead of time this was coming after they set up a call center in Austin that was immediately unnecessary and the voice mail from the then CEO gushing over the stock price hitting $100. We built up a war chest of sorts plus the severance that would have lasted a while but I got a job almost right away. While this turned out to be a very important milestone (in a good way), a lay off obviously can be very damaging. Living below your means is a way to mitigate the anguish it might cause.
The picture was taken this past Wednesday.
9 comments:
The Linked in comment is pretty funny. If Facebook goes public, it should be a riot to watch.
based in the LinkedIn IPO, the Facebook IPO might literally be a riot.
"I have yet to see a lemming, but if I ever do, I'm sure I'll see a lot more than one of them"...Anonymous
Just read about an Arizona aerospace company that has never had a lay-off. The CEO believes a lay-off is the last effort a company should make. To me, this type of CEO should be making the millions in salary, not the idiots that get bonuses for reducing staff because their numbers are now better. Our system is out of wack
They all say that until they face revenue or profit issues.
Interesting - The Big Picture blog touches on a theme of Roger's today. I didn't know the financial sector has jumped back up as a percentage of the S&P 500.
For what it is worth, Linkedin is the single most power business networking tool I have ever used. I have had multiple conversations with C-level exec's I never would have had access to in the past. A handful of relationships I made through LI have made me quite a bit of money. LI is the local chamber of commerce on steroids. I guess it must be good (for me anyway) that people are struggling to use it or it would lose its effectiveness much in the same way billboard ads, rubber chicken networking circuits and ....yes...email have.
Eric, congratulations to you and your colleagues at LinkedIn on a very successful IPO. Aside from the benefit you all get it might also create hope for employees at other social media companies.
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