Networking Moves from the Mixer to the Web
by Alf Nucifora
Lead networking groups have always held a particular appeal for the entrepreneur and/or salesperson whose livelihood depends on generating the lead and closing the sale. Groups such as LeTip, PowerCore, Business Network International and Ali Lassen's Leads Clubs represent the traditional model where members meet to introduce their services and exchange leads in a face-to-face setting. Most business and professional associations, particularly chambers of commerce, persist with the monthly after-hours business mixer, providing an opportunity for member vendor and customer to meet, negotiate and transact, or trade business cards. Advisory groups such as TEC and Renaissance Executive Forums also serve the purpose of uniting owners, managers and entrepreneurs in group meetings where business experience and learning are confidentially exchanged in a peer-to-peer environment.
Now comes the latest player in business networking…online networking sites that allow members to meet like-minded individuals, make connections, exchange leads, seek advice, keep in touch, and even get a new job. The primary role, however, is still to get more business. Notes CNN.com's Nick Eason, "These sites say they make finding business leads quicker and more reliable, including hiring employees, signing up distributors and locating industry experts." Not surprising, people active in traditional face-to-face clubs are the early adopters of the online version. In fact, the online sites sell themselves as an able complement to their offline counterparts.
The Major Players
At present, the online networking space is dominated by Ryze.com, Linkedin.com and itsnotwhatyouknow.com. Funded by Sequoia Capital to the tune of $4.7 million in recent financing, Linkein.com claims 48,000 regular users, active in 80 countries.
The largest and most active site is Ryze.com, founded in 2001 and operating with 80,000 members. The site, which initially focused on the high-tech community, now appeals to CEOs, entrepreneurs, and home-based businesses. CEO and founder, Adrian Scott estimates double-digit annual growth in member recruitment primarily from small and emerging businesses, entrepreneurs working from home and international participants particularly from India.
At present, most of the sites allow free membership and do not charge a transaction fee for referrals, although it is likely that referral payments will become a requirement if the model is to become profitable for the site owners. Says Konstantin Guericke, co-founder of Linkedin.com, "I have no doubt that ninety-percent of people will be happy to pay a fee for a referral they can't get any other way." Ryze.com, in addition to its standard no-fee membership, also offers a monthly, paid premium membership package that provides advanced search capabilities, customized domain name, and a "create your own network" option.
The online sites tout their increased leverage and greater viral potential vis-a-vis the face-to-face competition. And yet, in a round-about fashion, they acknowledge the fact that person-to-person interaction still remains a desired networker need. For instance, Ryze.com currently sponsors business mixers in twenty major cities, including New York, Los Angeles, Chicago and San Francisco. Says Scott, "Where we differ is that you can look at the invitation list before you attend, identify whom you wish to meet, chat in advance and establish the agenda before you actually meet." There is also no need to bring business cards since every attendee is already privy to the invitation/attendance list.
The Member Perspective
For the average small business lacking access to an established base of leads and prospects or the financial wherewithal to establish one, online networking provides access to a cornucopia of opportunity. Notes Barry Brager, President of Perception Partners, an intellectual property licensing and marketing firm, and member of the Ryze network, "It makes it easy to meet friends and friends of friends from all over the world. There's an excellent profile feature that lets me search for contacts by location or expertise, or even those who had the same former employer. It's an efficient and effective way to use the Web to expand my global network and discover the interests of others."
Brager obviously speaks for a growing number of entrepreneurs and small business operatives who are utilizing the viral nature of the Internet to grow their network and enhance their sphere of influence. Call it a tribal approach if you will, but with the tribe comes loyalty, commitment, familiarity and, best of all, an inclination to buy. Keep a close eye on online networking. It's a legitimate, growing force and a powerful weapon for marketers aiming to spread their wings and their web.