I’m very excited about this participation and the future cooperation with Burda. It’s a match made in heaven: Burda Media as the leading European media group and XING as the leading European business network. In recent years, the group has invested in the Internet continually, and is active online and offline with its own products and publications (CHIP, Focus, etc.) as well as participations (Tomorrow Focus, Glam Media, Zooplus). In doing so, Burda has proven itself to be a long-term and internationally oriented investor.

We still have a lot of plans on continuing to develop and grow XING. In this process, it’s great to have a strong partner such as Burda to support us.

Admittedly, the official explanation by the Nobel Committee is hard for a layman to understand. He is being honored “for his analysis of economic governance, especially the boundaries of the firm”.

You also may be wondering what all of this has to do with XING. Quite frankly, a lot. Oliver Williamson is particularly famous for his concept of “transaction costs”, meaning costs associated with doing business with suppliers. These include costs for searching for the right partner, costs for making the initial contact, negotiation expenses, and also costs connected with a contract signing.

These costs are higher than they might appear at first. A simplified summary of Williamson’s conclusions could be as follows: transaction costs play a key role in the entire structure of our economy. One reason is that transaction costs explain why there are companies, instead of just freelancers, selling their goods and services on the free market. Because of the high costs for certain transactions, it is simply less expensive to bundle them within larger companies. When transaction costs can be kept low, smaller companies and freelancers have a better chance of competing.

Here’s where the parallel to XING should become clear. Whether you’re searching for a new employee, looking for the right contact person at a company, researching potential business partners, or setting up any kind of trust network via contacts: XING can simplify and accelerate the process considerably. Or, as the new Nobel Prize winner might put it,  XING reduces transaction costs.

This may still sound theoretical to some readers, but in fact, a great deal of the benefits we as a professional network provider can offer is in that one sentence. Every day, we help tens of thousands of people to set up the initial business contact. That’s why it’s no surprise that freelancers are among our most loyal and active users. By using XING, they set up networks, become “visible” to potential clients, and make useful contacts. Countless “transactions” have been made through us – for the greater good of everyone involved. We’re proud of this, and we’re determined to do even more in the future. And thanks to Oliver Williamson, all of this is a little bit easier to understand.

Today I’d like to talk about one particular focus of ours – our international business. We have reached some significant milestones as a Germany-based company over the past few years, and currently around 4.3 million of our 7.5 million+ members are based outside of the German-speaking world. We intend to provide even more added value for these members in future. After all, (most) business is local! And this applies to XING too.

Hakan Gönenli.

In concrete terms, this means we plan to focus more strongly in future on the specific local needs of users in our key markets. Although networking does essentially work by the same set of rules – whether you happen to be in Istanbul, Barcelona, Milan or Hamburg – there are in fact a number of differences if you take a closer look. That is why we’ve established strong teams in our key markets – aimed precisely at responding better to these local needs.
I’d like to take this opportunity to introduce our Country Managers:

Hakan Gönenli in Turkey

Since May 2008, Hakan Gönenli has been heading up XING business in Turkey. Hakan has a lot of experience in the industry and is working with his team in the Istanbul office to increase market awareness of XING and to continue building up our position as the leading local business network in Turkey. He has many years of experience in the Turkish Internet and telecommunications market, having worked not only at the leading Turkish GSM provider, Turkcell, but also at the Turkish Dogan Media Group where he was in charge of the Internet division Dogan Online.

Cipriano Moneta.

Cipriano Moneta is heading up our new office in Milan
Since March 2009, XING has also had a local office in Milan to focus on the needs of our growing online community in Italy. Cipriano Moneta is an internationally respected Internet manager and we were delighted to have him join our company as a Country Manager to help us continue increasing the number of members we have in Italy. A native of Milan, he was previously the Managing Director at jobpilot Italia Srl, where he played a major role in making the job portal the market leader in Italy. After that he was Vice President at Monster Worldwide Deutschland GmbH, where he was in charge of European marketing. The leading Italian manager association, Manager Italia, voted him “Manager of Excellence” in 2005 for his outstanding work.

Daniel Perez.

Daniel Perez in Spain

As Country Manager, Daniel Perez is responsible for XING Spain. He worked in investment banking in London until 2000 and then returned to Spain to work in the Internet industry. Before coming to XING in April 2009, where he has been heading up the office we opened in Barcelona in 2008, his experience included co-founding two start-ups and serving as Director of the Spanish branch of the job portal Monster.

Our Country Managers and International team decide on the best regional strategies for promoting and increasing member growth and activity in their particular countries. This strategic planning includes local marketing activities, any necessary localization of the platform itself and defining the particular features available for Premium Membership and basic membership on a local level in their country. Our members in these countries can look forward to some exciting changes!

We remain fully focused on expanding our platform – both at home and abroad. Ultimately, all of our users will gain advantage from this, as a greater diversity of contact and business opportunities on an international level will strengthen the entire XING community. We are committed to making XING the most active business network in more and more regions throughout Europe, and you are certainly more than welcome to help us by recommending XING to your business contacts in other countries.

I’m especially happy that we’ve really stepped up our speed of innovation. We introduced a new feed on the home page – “Members you may know” – which has been very popular with members. Now with the successful launch of OpenSocial applications, we’ve laid the technical foundation for providing our members with relevant features developed by third-party developers. By doing so, we’ve started setting our strategic course for increasing the viral growth of our community in order to ensure profitable growth in the future.

In the months to come, we plan on keeping up the tempo. Now that we’ve launched the OpenSocial framework, we can start incorporating applications from selected third-party developers. Part of our focus is on HR professionals: we’re working on features especially for recruiters. We’ll also continue to improve the features we’ve added, working hand in hand with you, our members. I don’t think I’m only speaking for myself when I say it’s getting exciting around here.

Another of our areas of focus will continue to be international expansion. As we have in the past, we’ll continue to invest in our international markets. In the future, our focus will be on continental Europe, in particular the countries where we already have local offices: Italy, Spain, and Turkey. More than ever before, we want to localize our platform for users in other countries, for other cultures – and make efforts to accommodate the needs of our users in these countries. In coming weeks, international members will start to see the first benefits of our efforts.

In the coming months, we’ll work hard to develop the platform, and try to incorporate your suggestions into the development process. I’d like to thank those who have already taken the time to use UserVoice, our new feedback forum, to suggest improvements – keep up the good work! We know that in the end, our success depends on making your networking experience on XING more effective, and more fun.

I’m looking forward to your feedback!

I’ve been at XING for a good two months now. The busy last few weeks have flown by and I have had the opportunity to gain a much deeper insight into the factors that make XING so successful. I have spent most of this time getting to know my colleagues, talking directly to members, immersing myself in all aspects of our business and setting out clear areas of focus for the upcoming quarters together with my team.

New features are on the way, designed to create yet more value for everyone that uses XING:

• We will be launching an innovation offensive over the next few months with a clear goal to benefit as many of our members as possible. This offensive will see a variety of new features and functionalities that will enable members to network using XING in even more versatile and effective ways.
• Features aimed specifically at recruiters will hopefully make XING even more attractive for this highly promising target group.
• Last but not least, our network will continue to grow and become more international – opening up more and more opportunities for you to profit from new contacts.

We have set ourselves clear targets for each and every area of focus – and we are already working flat-out to achieve these goals. Much of the development work is already in the “home straight” phase for the second quarter.

At the same time, we also want to engage in a greater level of dialogue with you, our members. You can find out about all the things we’re planning and working on in this Blog – both from me personally and from many other colleagues of mine. We also want to involve you more directly in the ongoing development of XING and learn during this process from your own ideas and proposals for improving the platform.

We will be launching beta versions of new features over the coming weeks and welcome all your feedback from our research panel. Quite simply because it is absolutely in our own interest to develop and optimize XING as quickly as possible in a way that is geared solely to your practical working lives.

We’re delighted that so many thousands of members are already actively involved in this process as beta testers. We are of course always pleased to receive praise and compliments, but criticism and constructive ideas for improvement are even more valuable to us.

Because ultimately, our success is inextricably linked to your personal success as XING users, enabled through ever-more effective and enjoyable networking.

We look forward to receiving your feedback!

Best wishes,
Stefan Groß-Selbeck

It has long been clear to me, as a member in the past, what it is that makes XING different from similar platforms: Our members form a business community that really is uniquely active. They bring new momentum to professional networking on a daily basis with their many thousands of events, group postings and messages. A central task of mine as the new CEO will be to further develop and expand this unique community. Now I have finally started and I’m very much looking forward to getting to know all of my new colleagues in person. Lars Hinrichs has built up something with his team here in Hamburg that enjoys the utmost respect throughout the global Internet sector. Back in 2003 when almost all online businesses were teetering at crisis point and dozens of ambitious plans had failed, he came up with a new business idea and launched it online just a few weeks later. This alone is testimony to his entrepreneurial spirit and enterprise, more than ably assisted by his enthusiastic team.

The last five years have seen this start-up evolve into a highly successful and globally operational company. We already employ 192 employees in Hamburg, Barcelona, Istanbul and Beijing at present, and all the signs indicate that there is ample potential for further growth – especially in view of the current economic climate.
This places us in a very promising position and, for me, the exciting challenge now lies ahead of making our community the most active worldwide in more and more regions around the globe together with the whole team. We intend to drive the expansion of the platform further forward, integrating new features and functionality along the way. I am, of course, also reliant on your support in our endeavors to make XING even more valuable to you as members. I therefore welcome all your feedback – both positive and negative. I’m extremely keen to ensure a direct exchange with you, and for an online community like ours a Blog is of course a very fitting way to achieve this. I will be keeping you continually updated here on all the latest developments at XING, along with the rest of our 6.5 million plus members based in more than 200 different countries and not forgetting our shareholders. Please therefore stop by here regularly to catch up on our news, or simply subscribe to the RSS feed for the Blog.

As well as my regular posts here in this CEO Corner, I also look forward to communicating with members and reading their posts both in the XING Group and the Moderation Group. I reserve particular respect for the 34,000 moderators who have demonstrated such sterling self-initiative in building up more than 21,000 wonderful groups on the platform. My colleagues in the Community Management department will continue to moderate the group on an active and daily basis. Your input and feedback is nevertheless of great interest to me and I will be sure to keep you informed on particularly important issues.

Why do we think that socialmedian is a perfect fit for XING? Here´s why: In business success depends on access to the right information at the right time. Both the speed of information and the sheer volume of data have increased rapidly due to the rise of the internet. Traditional media companies, social media such as blogs, tweets, videos and other user-generated websites now provide daily news, leading to a veritable flood of information. The consequence: Time-strapped professionals are forced to parse through numerous news sources for relevant information and sort, organize, and share stories on their own.

Jason Goldberg, new VP XING Applications Platform

Thanks to socialmedian you can save the little time you have. Socialmedian gathers information from about 19,000 sources, including social media services such as Digg, Delicious, Twitter, Flickr, YouTube, Google Reader and many, many more. Socialmedian then filters your news through your social networking contacts. That means you get the news you´re looking for, the news that fit your interests and your passions. And it doesn´t stop there: Due to it´s intelligent custom filter technology socialmedian isn´t just for the individual member. Just think of all the ways it can help boost business for your groups, your events as well as for the company you work for.

On top of this great news Jason Goldberg, socialmedian´s founder and CEO, is going to join us at our headquarters in Hamburg. Jason is a pioneer in the Internet business, he founded the career development website Jobster in 2004 and headed the company as CEO. Now in his new role of VP XING Applications Platform Jason will be responsible for managing global partnerships for application developers and content providers to connect with our XING network.

We cannot wait for Jason to join our team and see how the innovative socialmedian technology becomes an integral part of XING! A big thanks to the deal team: Burkhard, Jackson, Johannes & Julian and everybody else who supported in this process.

The company has long since grown from a startup to one of the leading players in social networking worldwide. We were successful from the beginning, despite the voices of the critics. In 2003, we kept going and listened to those who relied on us to help more effectively manage their professional lives, and who continue to do so after five years. Working together in recent years, we have created structures to maintain the scalable and profitable growth.

By appointing Stefan as my successor (he currently heads eBay Germany), I’ve found a very successful and extremely Internet-savvy manager to lead XING. Now I’m able to concentrate once again on that which matters to me as an entrepreneur: developing new ideas and giving them life by means of entrepreneurial spirit. In the future, I will continue to advise XING as a member of the Supervisory Board. I am also the largest shareholder in the company, and intend on remaining so.

I would like to give special thanks to our over 170 hardworking and experienced employees from over 26 countries, many of which have become friends of mine. I’d also like to thank all our members – all of whom have made XING into that which it is today. Without the commitment of all those involved, XING would never have become the European leader for business networking with over 6.5 million members in such a short period of time.

I am certain that XING will continue its rapid development with Stefan, and I’m already looking forward to seeing the moment in which the new features we’ve been developing in the past months are launched one by one on the platform.

Let’s start a new chapter in the history of XING together. You as members can write a piece of Internet history, along with XING, Stefan and his team.

Since the IPO in December 2006, our numbers of our members have risen every quarter, thus driving up our revenues and results. Apart from the growth in revenues, XING AG is one of the small number of listed companies which combine such rapid revenue growth with an above-average profitability (our last quarter was at 40%). In these terms, XING AG is one of the most profitable companies on the German markets.

The unique success and the continuing strong growth of XING are attributable particularly to highly motivated and experienced employees – actually the best team I have ever been privileged to work with. Their commitment is our most sustainably productive capital. And, since the beginning of the year, we have recruited a further 52 employees in order to enable us to continue to successfully implement the growth strategy which we have initiated. We are not laying people off, we haven’t stopped hiring, or even slowing down the recruitment processs. Indeed, the reverse is true: we have over 40 open positions at present. As an entrepreneur I strongly believe that these times are excellent opportunities, and XING is ready to tackle them.
The new employees will help develop new ideas and business models, and provide XING with strong support for the successful implementation of numerous new projects which provide our members with additional added value for business networking.