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Addictive social discovery engine raises a second round, relishes its post-eBay freedom
Social discovery engine StumbleUpon announced Wednesday that it has secured a $17 million Series B round of funding from Accel Partners, August Capital, DAG Ventures, First Round Capital and Sherpalo Ventures.
StumbleUpon, the site that (with a click) takes users to a random destination based on their interests, wasn’t always a private venture. Well, it was, and then it wasn’t.
The service launched in 2001 and subsequently grew 150 percent year over year with just word of mouth promotion. Six years later, when it had accumulated around 2.3 million users, the service was purchased by eBay for approximately $75 million.
"StumbleUpon is a great fit within our goal of pioneering new communities based on commerce and sustained by trust," eBay's senior director Michael Buhr had said at the time.
Only problem was that, while StumbleUpon had everything to do with community sharing, it didn’t really have much to do with commerce (unless, of course, you’re the kind of StumbleUpon user who thumbs up eBay auction pages). In April 2009, nearly two years after the original acquisition, eBay sold the service back to its creators for $29 million.
In the same month, the company closed a Series A round of funding from Accel Partners, August Capital and Sherpalo Ventures, all of which have returned to invest in today's announced round.
Since its earlier round, StumbleUpon has doubled its registered user base to 14 million and more than tripled its content recommendations to more than 800 million per month. What’s most impressive about the still somewhat underground service is that, despite having less than three percent of the members as Facebook, StumbleUpon drives nearly as much traffic. Last month, Facebook accounted for 44.1 percent of social media traffic on the Web, while StumbleUpon took home 37.4 percent, according to Web analytics company StatCounter. All other social sites--Twitter, YouTube, reddit, Digg and others--don’t even come close.
The StumbleUpon toolbar for browsers has remained relatively unchanged, but the service has expanded to mobile with iPhone and Android applications that launched in August 2010.
StumbleUpon will use the new funding to improve the company core discovery technology, to expand to new platforms and grow the employee base.
“With this new investment, we will make it even easier for people to find interesting and relevant content on the Web, whether they are on their desktop, mobile device or even TV,” said Garrett Camp, StumbleUpon CEO and co-founder.
We’ve had the desktop and mobile versions, but TV? I’ve always likened the service to channel surfing on television, but now it looks like we’ll actually see StumbleUpon on the (kinda) big screen soon.
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Joined Vator onFounded in 1995, August Capital is a leading venture capital firm actively investing in entrepreneurial teams throughout the information technology market spectrum.