Klout acquired for $200 million by Lithium Technologies

Mar 27, 2014

JP Mangalindan has been a staff writer at Fortune since 2010, writing frequently about technology.

Klout's attempts to measure social influence earned criticism early on in the startup's life. Photo: JP Mangalindan/Fortune.com

FORTUNE -- Social score startup Klout has been acquired by Lithium Technologies, a provider of social customer experience solutions for the enterprise, in a deal valued at nearly $200 million, Fortune has learned.

According to two sources familiar with the matter, the deal is a mix of cash and Lithium private stock. (Lithium is gearing up for an IPO, which could happen as early as later this year.) Klout and Lithium are expected to announce the acquisition Thursday morning in a joint press conference. Technology news site Re/Code reported last month that a deal was signed but not closed. A spokesperson for Klout and Lithium declined to comment.

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Klout's history has been an interesting one. The startup was co-founded by CEO Joe Fernandez and Binh Tran in 2008 as a way to measure influence on the growing social web. Individuals who signed up would receive a "Klout Score," a numerical value between 1 and 100. In theory, the higher the Klout Score, the more social pull the user has.

Early on, Klout's scoring process earned controversy. How valuable is an individual's social pull? Could it be monetized? And how exactly were Klout scores achieved? To wit, at one point, President Obama ranked lower than tech influencer Robert Scoble, an issue that was remedied with a major redesign in 2012 that offered more accurate scores, as well as further transparency into how scores are measured. Since then, Klout has also expanded with Klout for Business, a portal intended to offer deeper analytics to brands, as well as content creation aggregation, so users could share articles and posts with their audience.

 

 

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