Facebook is a well known brand that stays behind the largest social networking website. In January 2014, the company had a market capitalization of $177.78 billion and 1.31 billion users. That means each Facebook user is worth around $136.
The company has its headquarters is in the United States and its founder and CEO is Mark Zuckerberg. Facebook is relatively young on the market, being founded in the year 2004. However, it didn’t take CEO Mark Zuckerberg long to realize that the best way to build a strong company, innovate his products and get talented employees was to purchase other companies.
The Facebook company is known for its aggressive acquisition practices. Since it has been launched, the company has acquired over 40 other companies. Facebook company has also made investments in Wildfire Interactive and LuckyCal.
The largest Facebook’s acquisition until now has been the purchase of WhatsApp, for $19 billion. For this acquisition Facebook has paid more than $40 per each user of WhatsApp. Facebook has also purchased the company ConnectU, as well as its rival social media company, Friendster. The majority of the Facebook’s acquisitions are companies based in the United States, most of them being companies based in the San Francisco Bay Area.
After an acquisition Facebook usually shuts down the acquired products. Facebook’s management mostly see these acquisitions as ‘talent acquisitions’. They don’t purchase a company for the business but in order to acquire its talented employees. Part of the entrepreneurial culture of the Facebook company is to ensure they are recruiting the best people in the software industry. And one of the ways for them to achieve this is to acquire other great companies. Among the few exceptions from this pattern is the Instagram acquisition. They purchased Instagram, Face.com, and Lightbox even in the midst of becoming a publicly traded company.
Here is a timeline of Facebook’s top ten mergers and acquisitions:
Acquires FriendFeed – August 10, 2009
FriendFeed was a company offering real-time news feed. They took their updates from various other social media sites. Facebook purchased FriendFeed for an amount of $50 million. After the acquisition, Facebook integrated the technologies from FriendFeed into their own service including the emphasis on real time news updates and their “Like” feature. Facebook also integrated the talent from FriendFeed in their own developers team.
Friendster Patents – May 13, 2010
Friendster was among the first social networking websites. Facebook has purchased for $40 million all of the Friendster’s social networks patents.
Acquires Sharegrove – May 26, 2010
Sharegrove was a company that provided real time content sharing services for friends and families on private online spaces. Facebook integrated Sharegrove into Facebook Groups after they purchased Sharegrove for an undisclosed sum. Now Facebook friends can privately share links, chats, and photos due to Sharegrove’s features. Sharegrove’s software engineering talent was also integrated into Facebook’s developers team.
Acquires Hot Potato – Aug 23, 2010
Hot Potato was a ‘check in’ service based on a mixt of GetGlue and Foursquare. Their service allowed users reading a book or listening to a song to check in to physical locations. Facebook purchased Hot Potato company for an amount of about $10 million. By integrating Hot Potato’s features Facebook was able to expand its own services by launching their Facebook Places feature and improving the functionality around status updates. As usually, Facebook also acquired new talent from Hot Potato company and integrated them in their own developers team.
Acquires Push Pop Press – Aug 2, 2011
Pop Press was a company that offered services for converting physical books into iPhone and iPad friendly formats. Facebook purchased Push Pop Press company for an undisclosed amount. They had no plans to infiltrate the book business. However, by this acquisition Facebook incorporated some of the Push Pop Press’ ideas into the Facebook experience as a whole. Some of this integration of new technology stays behind Facebook’s iPad app. Other features are giving people better ways to share their stories.
Acquires Instagram – April 9, 2012
In the year 2012, Facebook’s purchased another rival social media network, Instagram, specialized in photo-sharing services. The acquisition deal was made for the sum of $1 billion. Instagram is a social media network that allowed its users to post their pictures, edit it with digital filters, and share it with their followers. Facebook integrated some of the Instagram’s features into their own photo sharing service, as well as continuing to build Instagram as an independent brand in order to provide their users with best photo experience.
Acquires Karma – May 18, 2012
Karma was an app for mobile devices that allowed users to instantly send gifts to friends and family. Facebook purchased the developer company of Karma in order to integrate its 16 employees in their own team, to build a monetization prowess on mobile platforms. Facebook bought Karma for an undisclosed amount. It is still unclear whether Karma will become a Facebook branded product or the company will be left alone to run independently. Karma technology and features could be used by Facebook in order to suggest purchasing of real-world for your friends.
Acquires Pieceable – June 11, 2012
Pieceableis was a software company that focused on developing easy ways for publishers to build their mobile apps. Facebook bought Pieceable for an undisclosed sum not for its customer data or technology but just as a way to integrate its talent. The acquired new talent from Pieceable will help Facebook improving its App Center and developing on mobile platforms.
Acquires Microsoft’s Atlas Advertiser’s Suite – February 28, 2013
Facebook purchased Atlas Advertiser’s Suite from Microsoft in 2013, for an undisclosed sum. However, some sources say that the price of this acquisition was around $100 million. Atlas Advertiser’s Suites was a management service for online business. The social network will use Atlas to help agencies and marketers monitor their online advertising campaign performance. Facebook has plans to improve Atlas’ capabilities by enhancing its current suite of marketer tools and investing in scaling its back-end measurement systems. Atlas, alongside Datalogix and Nielsen, will help online marketers to compare their Facebook campaigns to the rest of their ad spend.
Storylane – March 9, 2013
At the date when Facebook purchased the company, Storylane was a relatively new social network. They were particularly focused around building a library of human experiences, telling stories, and crafting a community where users can share meaningful content. Facebook was interested in Storylane’s showcase of meaningful content. The staff of Storylane will join the Timeline team of Facebook.