Pinterest, the social scrapbooking/photo sharing site, completed a massive round of funding this week.
According to AllThingsD, Pinterest raised $200 million in a Series D round of funding led by Valiant Capital Management with the participation of existing investors Andreessen Horowitz, Bessemer Venture Partners and FirstMark Capital.
“Our focus is on helping millions of people discover things they love and get inspiration to go do those things in their life,” Pinterest CEO Ben Silbermann said in a statement to AllThingsD. “This investment gives us more resources to help realize that vision.”
The round of funding will likely be used to accelerate international expansion, product development, and expand the scope of its impact and reach.d internationally.
The latest round of funding brings Pinterest’s valuation to $2.5 billion.
But there are still a lot of missing features and services on Pinterest, that could turn the company into an advertising magnet, a complete ecosystem, and the ultimate social sharing platform for users and brands. Here’s a quick look at the things we’d like to see come of Pinterest’s latest funding round:
Similar to Twitter, Pinterest’s burgeoining ecosystem has attracted a bevy of third party tools and applications to fill in the feature gaps. We expect that, with fresh funding, Pinterest will offer some of these features directly.
One of the more recent feature add-ons for Pinterest users is from Ubokia, which introduced the Want It button to directs buyers to Ubokia’s want-centric marketplace for purchasing products you see on Pinterest. There’s also HOVR.IT, which allows users to search where a particular product is actually sold via image recognition.
What Pinterest needs now is to establish an actual marketplace where prospective buyers can flock to and place their orders. Yes, you can be redirected to the right website, but wouldn’t it be better if Pinterest just eliminated that step by having a place where entrepreneurs can actually sell direct?
We’d also like to see Pinterest offer a more engaging mobile experience, one that interacts with products in brick and mortar stores, or anywhere else in the real world. This could better capture consumer sentiment around particular products, and contribute to the vast data set Pinterest has built around its user base.
Pinterest already has a total of $338 million in venture funding. It’s first Angel funding round amounted to $500,000 in January 2010, followed by $10 million in a Series A funding in May 2011, $27 million in a Series B funding in October 2011, $100 million in a Series C funding in May 2012, and the $200 million it just closed. With that amount of cash in its pocket, Pinterest is primed and ready for acquisitions. But what companies could it possible acquire to boost its products and services?
The first company that comes in mind is Pinfluencer, the social media analytics firm that’s dedicated to everything Pinterest. The company recently introduced an image recognition engine, technology Pinterest could use the technology to improve its web and mobile apps. Pinfluencer also offers an extensive analytics dashboard, which will become increasingly important to brands looking to Pinterest as a marketing platform.
“We see every pin on Pinterest as a distribution opportunity for our customer brands and we have spent the last year helping these brands see how to identify their top and most influential pinners and learn which pins actually drive the most sales,“ said Sharad Verma, the CEO of Pinfluencer. “We are unveiling our new image technology to allow brands to understand which images on a webpage drives the most traffic relative to other images. These insights are extremely powerful.”
Another good bet for an acquisition is Fancy. Though Fancy has been dubbed the posh version of Pinterest, it’s quite different. First, you can purchase things directly on Fancy. Second, it’s a secure platform that confirms its sellers, acting as the middleman for handling consumer transactions. Taking on Fancy could open more doors for Pinterest’s marketplace, and would also eliminate the competition.
“What we’re saying is, let’s find out about the coolest stuff in the world through people who have amazing taste, and then we’ll ‘fancy’ it, and, if merchants and brands are seeing demand forming around a place or product that they want to sell, they’ll come to us,” said Fancy founder Joseph Einhorn.
And finally, to help Pinterest solidify its own marketplace, it could acquire ScanLife, the company responsible for the ScanLife app which scans QR codes, barcodes, Datamatrix, EZcode, so users can price check an item across 30 online retailers, so they’ll always get the cheapest deal. Pinterest could acquire it, integrate it to its mobile app, then when a consumer scans a code, Pinterest will look for the lowest price of the item, price-match it to Pinterest sellers, making the whole buying process easier for consumers.
Pinterest has one very significant advantage over Facebook and Twitter — its visual engagement. This has made it a unique platform for brands and buyers to interact, and its this high level of engagement Pinterest will want to develop as it solidifies an ad platform to generate more revenue. Big Data will be key to Pinterest’s ability to leverage its user activity, offering extensive metrics to the brands interested in advertising through pinboards.
Not surprisingly, Pinterest has already spawned an ecosystem around this concept. Late last year, Pinbooster introduced a business model similar to Twitter’s pay-per-Tweet, or Sponsored tweets, but for Pinterest Pins. It allows Pinterest users to promote brands’ pins for a fee. It’s a way for brands to advertise.
And that’s not the only cue Pinterest can take from Twitter. There’s another lesson to be learned from Twitter’s recently launched Ad API, to extend and better learn from cross-channel content distribution, further strengthening its platform. Here with more analysis on what Pinterest needs to do to build a data-driven business model is our own Kristen Nicole, who appeared on this morning’s NewsDesk show with Kristin Feledy.
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