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Microsoft CEO Satya Nadella on the LinkedIn acquisition

By Alvin Soon - on 14 Jun 2016, 11:11am

Read Microsoft CEO Satya Nadella’s internal memo to staff about buying LinkedIn.

Image source: Microsoft

Microsoft just surprised the world with its announcement that it’d buy LinkedIn for US$26.2 billion in cash total. The big question is why — we go into the possible reasons on our earlier post. Here are the reasons why in Microsoft CEO Satya Nadella’s own words, in the form of two internal memos; the first memo explains the acquisition to Microsoft staff, the second is an email to LinkedIn staff.

 

Satya Nadella email to employees on acquisition of LinkedIn

Team,

I'm excited to share that today Microsoft announced a deal to acquire LinkedIn. You can see how Jeff Weiner, the CEO of LinkedIn, and I envision the opportunity ahead in this public presentation.

This deal brings together the world's leading professional cloud with the world's leading professional network. I have been learning about LinkedIn for some time while also reflecting on how networks can truly differentiate cloud services. It's clear to me that the LinkedIn team has grown a fantastic business and an impressive network of more than 433 million professionals.

Given this is the biggest acquisition for Microsoft since I became CEO, I wanted to share with you how I think about acquisitions overall. To start, I consider if an asset will expand our opportunity — specifically, does it expand our total addressable market? Is this asset riding secular usage and technology trends? And does this asset align with our core business and overall sense of purpose?

The answer to all of those questions with LinkedIn is squarely yes. We are in pursuit of a common mission centered on empowering people and organizations. Along with the new growth in our Office 365 commercial and Dynamics businesses this deal is key to our bold ambition to reinvent productivity and business processes. Think about it: How people find jobs, build skills, sell, market and get work done and ultimately find success requires a connected professional world. It requires a vibrant network that brings together a professional's information in LinkedIn's public network with the information in Office 365 and Dynamics. This combination will make it possible for new experiences such as a LinkedIn newsfeed that serves up articles based on the project you are working on and Office suggesting an expert to connect with via LinkedIn to help with a task you're trying to complete. As these experiences get more intelligent and delightful, the LinkedIn and Office 365 engagement will grow. And in turn, new opportunities will be created for monetization through individual and organization subscriptions and targeted advertising.

Jeff and I both believe we have a significant opportunity to accelerate LinkedIn's growth and the value it brings to its members with Microsoft's assets and scale. In fact, when Reid Hoffman, the founder of LinkedIn, and I spoke about the opportunity for us to come together, he called it a "re-founding" moment for LinkedIn and an opportunity to reach the mission the company set out on 13 years ago.

The opportunity for Office 365 and Dynamics is just as profound. Over the past decade we have moved Office from a set of productivity tools to a cloud service across any platform and device. This deal is the next step forward for Office 365 and Dynamics as they connect to the world's largest and most valuable professional network. In essence, we can reinvent ways to make professionals more productive while at the same time reinventing selling, marketing and talent management business processes. I can't wait to see what our teams dream up when we can begin working together once the deal closes, which we expect will happen this calendar year.

A big part of this deal is accelerating LinkedIn's growth. To that end, LinkedIn will retain its distinct brand and independence, as well as their culture which is very much aligned with ours. Jeff will continue to be CEO of LinkedIn, he'll report to me and join our senior leadership team. In essence, what I've asked Jeff to do is manage LinkedIn with key performance metrics that accrue to our overall success. He'll decide from there what makes sense to integrate and what does not. We know that near term there will be no changes in who reports to whom so no reporting relationships at Microsoft will change in that regard. This approach is designed to keep the LinkedIn team focused on driving results while simultaneously partnering on product integration plans with the Office 365 and Dynamics teams. During the integration, we'll pick key projects where we can go deep together that will ultimately result in new experiences for customers. Kurt DelBene will lead the overall integration efforts at Microsoft in close partnership with Qi Lu and Scott Guthrie.

I'm on the LinkedIn campus today in California and will host a call for investors at 8:45 a.m. PT with Jeff, Brad and Amy -€” please join if you can. Following that, I'll then spend the day meeting with the LinkedIn team. Tomorrow, I'll host a special Microsoft employee Q&A -€” I hope you can make it.

So far, what I've learned about the LinkedIn team is how much our cultures share many of the same attributes. We both care deeply about individual and collective growth, and find deep meaning in the work we do to make a difference in our world. Together we'll do just that.

While I'm in northern California sharing our vision to empower professionals, the Xbox team is in southern California at E3 sharing our vision to empower gamers. I encourage you to check out the E3 press briefing, which starts at 9:30 a.m. Pacific Time.

Finally, if you're not on LinkedIn, join up now and start using and learning more.

Satya

Image source: Microsoft

Satya Nadella email to LinkedIn employees on acquisition

LinkedIn Team,

I am flying back to Seattle more energized and inspired after spending the day on your Mountain View campus and talking with many of you. From the moment I met Jeff I knew he was a special leader creating a special place at LinkedIn — your sense of purpose is palpable. A few years ago one of my mentors shared the idea that we spend far too much time at work to not find deep meaning in what we do. I sense you all feel that at a profound level too. I know that you came to LinkedIn to make a difference in the world, and I want you to know that I believe that, working together, we can make an even bigger and more positive difference in the future.

Jeff, Reid, Qi and I have started dreaming about what we ca do together. I like that Reid calls today a re-founding moment and Jeff so clearly sees how Microsoft can help LinkedIn achieve the mission you relentlessly pursue. I have spent a lot of time learning about LinkedIn while also reflecting on how networks can truly differentiate cloud services. Over the past decade we have moved Microsoft Office from a set of productivity tools to a cloud service across any platform and device. This deal is the next step forward for Microsoft Office 365 and Dynamics as we connect them to the world’s largest and most valuable professional network — LinkedIn. I know we’ll invent new ways to help professionals achieve more as we reinvent selling, marketing and talent management business processes. Please take a look at the presentation Jeff and I shared earlier with investors and the email I shared with the Microsoft team today.

As we get to know each other better, I thought it would be helpful to share with you the email I sent to my team a few years ago when I took on my new job. I wanted the team to better understand what motivates me and the opportunity I see for Microsoft. Most of all, I wanted to start the process of rediscovering our soul. As you learn more about us, I think you will find many commonalities in our culture and purpose as well as how eager our team is to partner with you, to learn from you and — perhaps most important — to make a difference in the world with you.

Satya

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