As it rings in its IPO, Facebook has continued its M&A activity by purchasing gifting app Karma. “We’re thrilled to announce that Karma has been acquired by Facebook,” the company says on its blog. “The service that Karma provides will continue to operate in full force. By combining the incredible passion of our community with Facebook’s platform we can delight users in new and meaningful ways.”
“We’ve been really impressed with the Karma team and all they accomplished in such a short time. This acquisition combines Karma’s passion and innovative mobile app with Facebook’s platform to help people connect and share in new and meaningful ways,” a Facebook spokesperson similarly tells me.
Karma is a relatively young app that launched back in February, and nearly instantly became a favorite in the gift-giving category. Its eye-pleasing interface and dead-simple system were great features on their own, but Karma worked with your Facebook profile in order to analyze when you might need to send a gift and for what occasion (i.e., it’s your cousin’s wedding or your brother’s graduation).
Now that social integration is likely to get even tighter. Predictive, simple, and nearly instant gift-giving would be a boon to Facebook, which has struggled with using its platform for any means of e-commerce. Facebook Deals was shuttered after failing to gain traction, although Facebook’s attempting to reignite some of the local-discounts magic with Offers. Still, it hasn’t quite found a good fit for the exchange of goods on its site and there’s no real purchasing system, and the simplicity and social aspects of Karma could finally help Facebook realize this.
The acquisition also echoes Facebook’s recent string of deals: mobile-focused. The company’s future is riding on its ability to either adapt to or adapt mobile, and it’s been busy bringing innovative, quality mobile app companies under its wing – such as Lightbox and Glancee (of course, Instagram cannot be forgotten). Whether to harness the power of the team behind these products or leverage their astounding platforms, it’s all a part of its attempts to improve its mobile strategy.
Just to clarify, this was no acquihire. Karma will not be shut down by the acquisition and business as usual will continue for now – although keep your eyes peeled for some more fleshed out Facebook integration. It could become an entirely Facebook-branded product. But the partnership opens doors for the Karma team as well, in the form of hundreds of millions of new users and some serious name recognition.
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