Wheelings & Dealings: Lithium Technologies Acquires Klout

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Klout – which provides scores that measure influence on social networks – has been acquired by Lithium Technologies for about $200 million, according to news reports.

Fortune reported that the deal involved both cash and Lithium private stock.

It comes as Lithium, which offers social customer service management, is planning an IPO, which Fortune speculates may happen this year.

Klout offers users something called a "Klout Score" between 1 and 100. “The higher the Klout Score, the more social pull the user has,” Fortune explained. The company was founded by CEO Joe Fernandez and Binh Tran in 2008.

Since then, Klout has integrated signals from seven social networks and added information from Bing and Wikipedia.

But because of some questionable results (for instance, President Barack Obama had a lower score than Robert Scoble, a technology specialist) an upgrade was made to the system in 2012, Fortune said.

Now, Klout says it has 500 million scored profiles; 200TB of data ingested; 1.25 million Klout Perks delivered; 15 billion daily social signals; and 50 billion API calls monthly.

More recently, Klout is offering Klout for Business, which provides analysis of brands and the sharing of posts and articles with audiences.

In a blog post, Fernandez recalled, “We started Klout in 2008 with the crazy idea of measuring the world’s influence. We wanted to help people understand and be recognized for the impact of their voice.”

“The Klout Score has grown into the standard of influence and our platform has evolved significantly to help users share their passions online,” he added.

Why is it a good move for Lithium?

“Lithium powers many of the most vibrant communities online for leading brands like Spotify, Skype and Sephora,” Fernandez said in his blog post. “Together, we can do more to help you share your passions, measure your impact, and grow your reputation…. Lithium shares our passion for empowering every person to understand and maximize their impact online.”

In addition, Mark Schaefer, an industry analyst, speculated that Lithium may be interested in Klout's data “to better connect and understand consumer influence,” Mashable reported.

It is interesting that Klout identifies topics where users are ‘influential.’ “Brands can use the service to identify individuals who may be able to amplify messages about their products or services,” Mashable said.


Edited by Rory J. Thompson
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