However, the multiple of XING and LinkedIn are almost equal with their values of 31 and 32, respec-tively, and when comparing XING to an average of LinkedIn and the industry multiple, XING is slightly overestimated (9%). An EV/EBITDA estimate of 31 therefore seems very reasonable, whereby the val-uation of XING is supported by the multiple analysis.
new business model should be changed to create a networking platform for Blue Collar Workers that enables a perfect match between employer and employee. Thus, the platform should focus on the segment of Blue Collar Workers. However, ISS should not only pursue the “perfect match”, since value creating opportunities also exist in terms of networking activities among Blue-Collar Workers. These will be de-scribed in Section 9.2, when analyzing the operating synergies.
The establishment of a professional NP directed solely towards Blue-Collar Workers will lead to the creation of a business model not seen in the market today. ISS is assumed to possess a competitive ad-vantage within this field due to their global workforce of 494,233 of which 90.5% are Blue-Collar Workers (Appendix 1). Coupled with their high turnover rate contributing to several workers passing by ISS every year, ISS has an obvious advantage within the critical creation and maintenance of a user network. As a final remark, the NP is deemed to create the highest value when kept as a separate brand, decoupled from ISS. The digital NP that focus on both B2C and B2B is not in line with the overall strategy of ISS, and thus the NP is assessed to be most value creating for ISS when preserved as a separate brand.
(2) XING E-recruiting Services
The XING E-recruiting services focus on employer and employee reviews where value is created through services that support efficient employer branding and employee sourcing. Currently, both the Kununu and XING platform offer the services of E-recruiting, which will be uphold going forward, i.e. the E-re-cruiting services should be kept as a separate unit and not be included as a part of the ISS brand and legacy. Thus, it should operate under the same roof as the networking platform with the value proposi-tion of supporting valuable and efficient employer branding and employee sourcing. In this way, ISS will be able to provide the services of E-recruiting, assisting various companies and clients with the sourcing of suitable candidates, as well as providing the services of employer branding, without mixing it up with their current ISS-operations and strategy.
(3) XING Event Management Services
XING Event Management services includes various services within preparation and execution of an event such as ticketing, registration, entry management and customer retention. The Event Management services solely focus on the handling of events and therefore do not support the new business model’s overall mission of creating a networking platform for blue collar workers that enables a perfect match between employer and employee. Instead, the value proposition of this segment is narrowed and could be acted out through the following: the creation of hassle-free and enjoyable experiences for event-organ-izers and guests. Furthermore, the Event Management services should not undertake the limited focus
of servicing industries that primarily employs Blue-Collar Workers, since they are deemed more value creating when dispersed on a global scope, i.e. to the global B2B client network of ISS. On the basis of above considerations, the Event Management services are most value creating for ISS when included as part of the ISS family. The services are compatible with the IFS solutions and the overall strategy of ISS, since it is assessed to be highly likely that the existing clients of ISS can benefit from the Event Manage-ment services.
The changes and adjustments presented above will form the foundation for the new business model. It should be emphasized that the new business model could presume a number of different forms and shapes. However, it is assumed that this business model is the most value adding solution from ISS’ point of view, whereby the subsequent analysis will use the business model presented below as its point of departure. The outcome that is expected from this business model will be used to further analyze the value creation from the synergies.
Illustration 4. New Business Model.
The business model canvas above shows that the key resources are comprised of know-how in terms of software development skills and the platform supporting networking for Blue-Collar Workers, E-re-cruiting and Event Management. In this respect, the key activities from an ISS perspective mainly includes software development, and thus maintenance of the digital platforms. The channels through
which the users and clients will be reached are the platform websites as well as mobile apps. The rela-tionship to customers is characterized by co-creation, where the value of all three service segments is created through a collaboration between the users and ISS. Additionally, the customer relationship is subject to same-side network effects, meaning that the user’s utilization value increases when the cus-tomer database grows (Zambrano, 2016). Key partners mainly exist in the form of content providers who contribute with e.g. news and articles. The cost structure in the new business model is mainly char-acterized by development costs, staff costs to software engineers and marketing expenses. The revenue streams from the NP will arise from premium subscribers where the E-recruiting services will generate revenue from license fees and pay-per-click. Finally, the Event Management services will generate rev-enue from a fee per participant plus a percentage of the ticket price.