February 11, 2014 / 8:25 PM / 5 years ago

Lithium Technologies to buy social-media gauge Klout: report

SAN FRANCISCO (Reuters) - Marketing company Lithium Technologies is near a deal to buy social-media measurement business Klout, according to a report.

The deal, first reported by the technology news site Re/code, would marry Lithium’s social-media focused customer-service business with Klout’s analysis of brands’ and individuals’ social-media savvy. The price tag was at least $100 million in a mixture of cash and shares of Lithium, which like Klout is privately held, the report said.

It is unclear how big a return that would represent for Klout backers, who invested at least $40 million in the company, including a $30 million round in 2012. Backers include Kleiner Perkins Caufield & Byers, which led that 2012 round; Institutional Venture Partners; Mayfield; and Microsoft Corp (MSFT.O).

Lithium, founded in 2001, has raised more than $150 million from investors such as Shasta Ventures, Emergence Capital Partners, Benchmark, DAG Ventures and New Enterprise Associates. It is considered a candidate for a 2014 initial public offering.

Klout was born out of founder Joe Fernandez’s inability to speak after jaw surgery, a period when he relied on sites like Facebook (FB.O) and Twitter (TWTR.N) to communicate. It has not gained as much traction as fans predicted a couple of years ago, despite heavy press over incidents such as assigning President Barack Obama a lower influence score than singer Justin Bieber.

Late last year, transportation service Uber hired away Klout’s chief operating officer Emil Michael.

“The transition from interesting technology (or if you want to take the negative view, silly ego novelty) to real business has been painful,” Fernandez wrote in a September blog post.

Both Klout and Lithium are based in San Francisco.

Reporting by Sarah McBride; Editing by Nick Zieminski

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