Salesforce.com Snaps Up Radian6 for $326 Million

Deal a Sign of How Important Monitoring the Social Web Has Become to Corporate America

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The social-media-monitoring space just got a little hotter.

Cloud computing giant Salesforce.com snapped up Radian6, the leading social-media-monitoring firm, for $325 million in cash and stock, a sign of how important monitoring the social web has become to corporate America.

Founded in 2006, Radian6's technology monitors conversations across Facebook, Twitter, YouTube, blogs and online communities and is used by marketers including General Electric, PepsiCo, Dell, and more than half of the Fortune 100, according to the company.

Many ad agencies use the technology as well, but the space is nascent and the industry is still trying to figure out how best to monitor and measure social activity, as well as how to use the data effectively.

"With Radian6, Salesforce.com is gaining the technology and market leader in social-media monitoring," Marc Benioff, CEO of Salesforce.com, said in a statement. "We see this as a huge growth opportunity. Not only will it accelerate our growth, it will extend the value of all our offerings."

Salesforce.com says the integration of Radian6 will allow it to combine analysis of public network conversations with its own secure corporate social network, Chatter, as well as other "cloud" sales management products. Salesforce.com expects the deal to increase revenue $45 million to $50 million in the current fiscal year ending in January.

The deal comes after Salesforce invested in Twitter and Facebook management tool Seesmic, and invested in lead-generating software firm HubSpot.

Radian6, one of dozens of social-media-monitoring companies that have flooded the market over the past few years, is backed by Summerhill Venture Partners, Brightspark Ventures and BDC Venture Capital.

Other startups in the space include Crimson Hexagon, ExactTarget, NetBase, Peoplebrowsr, Scoutlabs, Cision, Overtone, Lithium, Buzzlogic, Brandwatch, Jive Software, Visible Solutions, Trendrr, Klout and many, many others. The deal sets a healthy benchmark for valuations, as well as the need to measure the fast-growing social web.

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