LinkedIn 2011 Annual Report Download - page 26

the extent competitors are better able to provide advertisers with cost-effective access to attractive demographics,
either through new business models or increased user volume, we may not be successful in retaining our existing
advertisers or attracting new advertisers, and our business would be harmed.
Finally, other companies that provide content for professionals could develop more compelling offerings
that compete with our premium subscriptions and adversely impact our ability to sell and renew subscriptions to
our members.
If we fail to effectively manage our growth, our business and operating results could be harmed.
We continue to experience rapid growth in our headcount and operations, which will continue to place
significant demands on our management and our operational and financial infrastructure. As of December 31,
2011, approximately 52% of our employees had been with us for less than one year and approximately 82% for
less than two years. As we continue to grow, we must effectively integrate, develop and motivate a large number
of new employees in various countries around the world, and we must maintain the beneficial aspects of our
corporate culture. In particular, we intend to continue to make substantial investments to expand our engineering,
research and development, field sales, and general and administrative organizations, and our international
operations. To attract top talent, we have had to offer, and believe we will need to continue to offer, highly
competitive compensation packages before we can validate the productivity of those employees. We face
significant competition for talent from other internet and high-growth companies, which include both publicly
traded and privately-held companies. As we have transitioned from a private company to a public company, this
competition has become even more acute in assessing appropriate compensation packages. The risks of over-
hiring (especially given overall macroeconomic risks) or over-compensating and the challenges of integrating a
rapidly growing employee base into our corporate culture are exacerbated by our international expansion.
Additionally, we may not be able to hire new employees quickly enough to meet our needs. If we fail to
effectively manage our hiring needs and successfully integrate our new hires, our efficiency and ability to meet
our forecasts and our employee morale, productivity and retention could suffer, and our business and operating
results could be adversely affected.
Additionally, if we do not effectively manage the growth of our business and operations, the quality of our
solutions could suffer, which could negatively affect our brand, operating results and overall business. Further,
we have made changes in the past, and will in the future make changes, to our features, products and services that
our members or customers may not like, find useful or agree with. We may also decide to discontinue certain
features, products or services, or charge for certain features, products or services that are currently free or
increase fees for any of our features, products or services. If members or customers are unhappy with these
changes, they may decrease their engagement on our site, or stop using features, products or services or the site
generally. They may, in addition, choose to take other types of action against us such as organizing petitions or
boycotts focused on our company, our website or any of our services, filing claims with the government or other
regulatory bodies, or filing lawsuits against us. Any of these actions could negatively impact our member growth
and engagement and our brand, which would harm our business. To effectively manage this growth, we will need
to continue to improve our operational, financial and management controls, and our reporting systems and
procedures by, among other things:
• improving our information technology infrastructure to maintain the effectiveness of our solutions;
• enhancing information and communication systems to ensure that our employees and offices around
the world are well-coordinated and can effectively communicate with each other and our growing base
of members, enterprises and professional organizations;
• enhancing our internal controls to ensure timely and accurate reporting of all of our operations; and
• appropriately documenting our information technology systems and our business processes.
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