Viadeo, the French rival to LinkedIn, has decided to leave China so that it can concentrate on improving its profit ratio. The company will also shut down its data center office in California to cut down the costs and is planning to make it virtual. Viadeo eight years ago entered China by investing in a professional social network Tianji.com. The site will now be closed down after Viadeo exits China on the last day of the year 2015.
Tianji.com Fails to Generate Revenue
LinkedIn is a professional network that was getting tough competition from Viadeo. The network with more than 277 million users across 200 countries and territories is far ahead from Tianji.com, with only 25 million users. According to Viadeo, Tianji.com failed to attract required development resources that are currently driving the highly competitive market of China. When Viadeo entered the Chinese market, it had decided to divert one-third of the revenue of its 2014 IPO for developing the Tianji.com.
Since the venture failed to come up with enough capital, Viadeo could not attract the required amount of investment from the private investors.
Three Products from LinkedIn Generate Money
LinkedIn offers free solutions including managing professional identity, engaging and building professional networks, accessing knowledge and insights, opportunities and access from anywhere, everywhere. At present, the company is generating its revenue from three different products including Marketing Solutions, Premium Subscriptions and Talent Solutions.
Viadeo aimed to develop Tianji.com on similar platform to generate revenue. However, the plans did not materialize. In the first quarter of 2015, the French company tried to rope in a buyer, local partner, an investor, who could ensure commitment and guarantee stability of its product in the market. The slowdown in the Chinese economy followed by a prominent financial disaster in 2015 summer served as the detrimental factor for the growth of Viadeo’s Tianji.com.
The company is now planning to focus all its attention on the home front and in other countries with French as one of the languages. The primary emphasis of Viadeo will now be on its B2B sales model.