Companies similar to LinkedIn are stepping in to fill the gaps it has left in the professional social networking space.

LinkedIn (NYSE:LNKD) released its Q3 results last Thursday, revealing another successful quarter.
While LinkedIn maintains its status as the top social networking site for professionals, other companies are stepping in to fill niches left underserviced by LinkedIn. For example, Professional Diversity Network (NASDAQ:IPDN) has targeted a need in the market by tailoring its career consulting services towards specific cultural groups.

Share price spike for LinkedIn

As mentioned, Q3 was successful for LinkedIn, and unsurprisingly its share price spiked after it released its results for the period. At market close last Thursday, shares of the company were trading at $217. On Friday morning, shares had jumped to $240.46, reaching a peak of $245.93 mid-morning.
During Q3, the company’s revenue increased by 37 percent from last year, hitting $780 million. According to Business Insider, that’s up from analyst estimates of $757 million. Those numbers reflect the fact that LinkedIn is consistently gaining active users. Indeed, the website had 396 million account holders as of the end of September, representing a 16-million gain in just three months.

Professional Diversity Network
LinkedIn CEO Jess Weiner attributes the network’s success to one simple element: “LinkedIn’s value proposition is simple — connect to opportunity.” Other companies have caught on to that strategy, and, as mentioned, are stepping in to fill gaps that LinkedIn has left in the professional social networking space. Professional Diversity Network is one such example.
The company operates online professional social networking communities tailored to different cultural groups. Specifically, Professional Diversity Network is looking to fulfill the unique networking needs of Hispanic-Americans, African-Americans, military professionals, women, students and LGBT individuals. It does so by connecting employers and prospective employees, offering resume database access, job postings, career advice, research services and other networking capabilities.

The company is also the operator of a holding company for the National Association of Professional Women, Noble Voice and Compliant Lead. These subsidiaries all offer career consultation services services.
Professional Diversity Network has a market capital of $11.45 million and is currently trading at $0.80 per share. That’s up from its 52-week low of $0.50, but a far cry from its year-to-date high of $5.60, seen on March 9. Nonetheless, Zacks upgraded Professional Diversity Network from a “sell” rating to a “hold” rating on Wednesday, one day prior to the release of LinkedIn’s quarterly results.
For investors looking for a smaller-scale play that is similar to LinkedIn, this company may be a fit.

Securities Disclosure: I, Morag McGreevey, hold no direct investment interest in any company mentioned in this article.