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Social media company supposed to help Walmart replicate in-store sales in the e-commerce space
Wal-Mart announced Monday morning that it has agreed to acquire social media startup Kosmix to aid the retailer in honing its mobile and social e-commerce experience. Terms of the deal were not disclosed, but the acquisition is expected to close during the first half of this year.
Kosmix has developed three distinct social media-based Web services. Tweetbeat aggregates tweets for popular events and topics, like sports games and breaking news, in real-time. Kosmix.com can sort of be described as a social media-sourced encyclopedia, allowing users to search for any topic to learn about it. And RightHealth provides health and medical information. (Side note: Saumil Mehta, former product manager for RightHealth, went on to found Locbox, one of AngelPad’s recently demoed startups.)
How exactly Wal-Mart will benefit by acquiring current offerings from Kosmix or its team is still unclear.
Company founders Venky Harinarayan and Anand Rajaraman and their team will operate under Wal-Mart as the @WalmartLabs team, whose goal is to create social and mobile-based technologies to support the overall company’s retail business.
A visit to twitter.com/walmartlabs reveals a live account, but it has sent out zero tweets and only has a handful of followers. Apparently, it’s just a placeholder for now.
“We are expanding our capabilities in today's rapidly growing social commerce environment," said Eduardo Castro-Wright, Walmart's vice chairman. "Social networking and mobile applications are increasingly becoming a part of our customers' day-to-day lives globally, influencing how they think about shopping, both online and in retail stores.”
Financially, Wal-Mart has been doing fairly well, last reporting fourth quarter sales of $115.6 billion, up 2.5 percent from the year before. Net sales for the full year were $419 billion, growing 3.4 percent. That said, Wal-Mart’s core business--store sales in the U.S.--slipped 1.8 percent.
Those numbers make it readily apparent to the company that it needs to amp up its online presence as a means of bolstering its brick-and-mortar offerings. Whether that means creating mobile solutions that users can take in stores or simply building up Wal-Mart’s Web properties can’t be said for certain just yet.
Whatever Wal-Mart's strategy, though, Kosmix will obviously play a major part in achieving that vision.
Founded in 2005 and headquartered in Mountain View, Calif., Kosmix had raised four funding rounds totaling $40 million from Accel Partners, DAG Ventures, Lightspeed Venture Partners, Motorola CEO Ed Zander and Time Warner Investments.
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Kosmix was acquired by Walmart in May of 2011 to create @WalmartLabs.
Through the innovative fusion of retail, social and mobile, @WalmartLabs is redefining Commerce for the largest retailer worldwide. We are a group comprised of the brightest technologists and businesspeople in the industry, excited about the limitless opportunities that this next generation of Commerce will bring to billions of people around the globe, all in an effort to help them save money and live better.
Kosmix was funded by Time Warner Investments, Accel Partners, Lightspeed Venture Partners, Dag Ventures, private investor Ed Zander and Jeff Bezos' personal investment company, Bezos Expeditions.
WalmartLabs is hiring.