Piano acquired social media metrics startup SocialFlow on Wednesday to boost the analytics platform’s social media capabilities for publishers.
Terms of the deal were not disclosed, but Piano CEO Trevor Kaufman said the cost of the acquisition was under $50 million. The cash purchase was funded by existing Piano investors Updata Partners and Rittenhouse Ventures, as well as investment firm Sixth Street Partners.
Piano, headquartered at the Bourse building in Philadelphia, works with media companies like CNBC, the Wall Street Journal and Philadelphia Business Journal parent company American City Business Journals to track publisher data and grow subscriptions, as well as personalize reader experiences. New York-based SocialFlow similarly works with media businesses — with clients including Condé Nast, Disney and the New York Times — to monetize premium content online.
SocialFlow is used by more than 10,000 social media accounts with a combined 2.7 billion followers, according to the company.
Piano and SocialFlow were a match, as both businesses serve the publishing and media industries. The two companies have about a 20% overlap in their client bases, Kaufman said.
“We work in a difficult industry in digital publishing," Kaufman said. "What we've tried to do at Piano in order to better service the market is to consolidate a lot of these functions. So I think it tends to be difficult for a company just working on primarily organic social posting to reach great scale, and therefore it makes sense for them to find a home in an organization like Piano.”
SocialFlow CEO Jim Anderson will not join Piano, but he will serve as a consultant for the company to aid with the transition. Piano will bring on about two-thirds to three-quarters of SocialFlow’s team of 20, bringing Piano’s employee count to 660, Kaufman said. The SocialFlow team will work with Piano employees out of a new New York office the company is opening.
The integration of SocialFlow’s technology into Piano will allow media companies to track which readers are coming to their websites from social media and subscribing, while also identifying audiences that may unsubscribe and putting out content that they are likely to engage with, Kaufman said.
Piano plans to invest in further developing SocialFlow’s platform, so when combined with Piano’s platform it can create a “multiplier effect” to get more eyes on publisher content, he said.
“It's already world-class, but we think we can take it to another level,” Kaufman said.
SocialFlow won’t be Piano’s only acquisition in 2022. The company is coming to the finish line on another deal in the social media metrics space, Kaufman said. He declined to disclose the name of the company but said the deal will likely be announced in the next 45 days.
Piano is rapidly growing, with annualized recurring revenue reaching $75 million in 2021, according to a company spokesperson. The company’s run rate puts it on track to reach $100 million in revenue by the end of the second quarter this year, Kaufman said. Piano was named to the Inc. 5000 list of the fastest-growing companies in 2021, with 470% revenue growth over three years.
Piano last raised $88 million in a funding round in May, a deal that brought LinkedIn on as an investor partner and also included venture capital firms Updata Partners and Philadelphia’s own Rittenhouse Ventures. The firm currently has no plans to fundraise again, but it has seen some outreach from potential investors, Kaufman said.
An initial public offering also remains on the table, but a potential timeline is unclear.
“We think about the business as a public company at some point, but we think now is too early for that,” Kaufman said. “So the business is profitable, and we're just focused on execution now as opposed to capital raises.”
