Gifting app developer Karma has been acquired by Facebook for an undisclosed sum, with the target stating that its service will “continue to operate in full force.”
The app enables users to select a gift from a catalogue to send to a recipient, who is then able to confirm details, swap it for something else, or donate the value to charity. The company said that in the last year, it has “built a new ecommerce platform from the ground up,” as well as “harnessing the power of Facebook’s social network.”
The acquisition comes as Facebook looks to bolster its mobile strategy, following its US$1 billion acquisition of Instagram, and its hire of the team behind the image sharing app Lightbox. It has also recently announced its own app portal, to provide users access to social apps.
In the run-up to its IPO, which valued Facebook at more than US$100 billion, it was noted that mobile is something of a weak point for the company – as more and more users access the service via mobile, the company has less opportunity to serve ads. It has yet to monetise its core mobile social networking proposition, unlike its ad-supported web service.
The acquisition of Karma will give Facebook an opportunity to earn income from the sale of products, as well as providing it with an ecommerce platform which could underpin other products and services.
According to TechCrunch, the founders of Karma, Lee Linden and Ben Lewis, also have significant experience in the apps space, having previously founded the original TapJoy – a company specialising in app distribution and monetisation.