Peanut Labs, a company with a cute little name that enables other companies to gather consumer data for market research by embedding surveys into social networking sites, announced Monday night that it has been sold to online research company, e-Rewards, which owns Research Now, an online data and sampling collection company.
Founded in 2007, the San Francisco, Calif.-based startup originally got its start in 2005 as Xuca.com, a social network that could generate profits by allowing market researchers to gather user data by surveying members. To do this, the company provided members with “peanuts” (hence the cute little name), a virtual currency that allowed users to earn and distribute reputation points among other site users in exchange for completing surveys.
Despite raising $1.3 million in seed funding and drawing in 1.6 million users, the site had nowhere to go, so the creators made the decision to reverse the order: instead of managing a social network with the aim of making money through surveys, the company would make money by refining their survey technology to be integrated into other established social networks.
Users, such as Facebook members, fill out preliminary profile questionnaires that then allow Peanut Labs to target those very users with more relevant surveys in exchange for the chance to earn virtual currency (dare I broach the pun, “working for peanuts”?).
For example, later this year, Peanut Labs’ surveys will be made available on Facebook’s Credits platform. So if you are playing a game on Facebook, you may be invited to complete an online survey in exchange for Facebook credits. Other partners currently include Bigpoint, Changyou, Nexon, Playspan, Pogo, Rockyou, Playdom, and Playspan.
Today, Peanut Labs works with 400 networks and applications and has a respondent pool of some 240 million consumers, which will broaden e-Rewards’ social network reach. “Peanut Labs will accelerate our social media strategy while enhancing the global capabilities we offer to researchers,” said Chris Havemann, President and CEO of e-Rewards, in a prepared statement.
E-Rewards, headquartered in Dallas, Texas, owns Research Now, within which Peanut Labs will become fully integrated in January 2011. e-Rewards is an online market research company that allows companies to conduct and market research surveys to panelists.
Since its founding, Peanut Labs has raised $3.2 million. The financial terms of the deal were not disclosed, other than to say that Peanut Labs will be maintaining its brand identity and will be known as Peanut Labs, an e-Rewards company.
In addition to the merger, Peanut Labs will no longer be charging publishers for CPA offer monetization programs for the rest of 2010, in favor of emphasizing market research surveys. The company’s press release cites a November 2009 survey that found that social media users reported favoring market research surveys over CPA offers by a margin of 2:1.
“We know that users prefer market research surveys to CPA offers, and with Research Now’s global network of market research clients, Peanut Labs now has sufficient survey inventory to monetize all of our partners’ titles,” said Peanut Labs CEO Ali Moiz in the company's press release. “If a company remains interested in providing its users with CPA offer opportunities, we will provide those, but we don’t intend to make money on these transactions.”
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