Facebook Apps BranchOut and BeKnown Take on LinkedIn

LinkedIn (NYSE:LNKD) is facing threats from apps such as BranchOut ^[1] and Monster’s (NYSE:MWW) BeKnown ^[2] that seek to leverage Facebook’s platform to take on LinkedIn’s lead in professional networking. Although LinkedIn has a clear lead in this market, its growth prospects could suffer if these apps take off. LinkedIn competes with Monster (NYSE:MWW) in the recruitment services market and with Facebook and Google (NASDAQ:GOOG) in the social media and online advertising markets.

We currently have a price estimate of $30 for LinkedIn’s stock, which is well below its current market price of around $100. (see LinkedIn’s Valuation as Facebook of Recruiting Hard to Justify). We estimate that recruitment services and job postings contribute 48% of LinkedIn’s stock price estimate.

BranchOut’s Booming Growth

BranchOut was launched in August 2010 and has become the largest professional networking service on FaceBook in a short period of time. It started as an app that allowed users to see where their friends worked and see employment details of friends-of-friends. User growth has surged to over 817,000 as of June 2011, which was boosted when the app started posting relevant job listings on its homepage. ^[3]

Although BranchOut maintains that it allows people to connect professionally on Facebook without granting access to others personal Facebook profiles, some people are still leery of mixing their business and personal networks. If BranchOut can overcome this concern, it could become a viable alternative for those who are comfortable using Facebook for professional network or don’t want to build a new professional network on LinkedIn.

BeKnown is Monster’s Answer to BranchOut, LinkedIn

Just two weeks ago, Monster launched BeKnown in 35 different countries that account for 450 million Facebook users. BeKnown enables users to ring fence their professional network from their friends to address concerns over mixing business and personal affiliations. A user must invite his or her friends to BeKnown in order to add them to his or her network and in some instances may have to defriend contacts to add them to their professional networks. While BeKnown populates its jobs database with Monster.com’s postings, the aim is to add native content over time.

Threat to LinkedIn?

LinkedIn’s head start, size, new services and the fact that it’s a purely professional network where people are comfortable posting jobs, searching jobs and revealing business affiliations will help LinkedIn maintain its lead position professional networking.

However, given the size of Facebook’s platform and user familiarity, users may opt for Facebook apps like BranchOut and BeKnown in the future as long as privacy settings satisfy their needs. This competition can hurt LinkedIn’s growth prospects and potentially pricing if these apps serve as viable alternatives.

You can drag the trend lines in the  modifiable charts above to see the impact of these trends on LinkedIn’s stock value.

See our complete analysis for LinkedIn stock here.

1. About BranchOut [↩]
2. Monster Launches First Truly Global Professional Networking App for Facebook with Introduction of BeKnown, press release, June 27th, 2011 [↩]
3. According to Inside Facebook tracking service [↩]