Contact: Martin Schneider, Ben Kolada
Social marketing and customer support vendor Lithium Technologies announced on Tuesday the acquisition of its young partner, Social Dynamx. In January, Lithium secured a $53m series D funding round (bringing total funding to $101m) and said it planned to use the funds for product development and hiring. Apparently, this acquisition serves a bit of both of those goals.
Terms of the deal weren’t disclosed, though we suspect the consideration was a small amount of cash and stock. Austin, Texas-based Social Dynamx employs about 25 people, and all regular employees are expected to join Lithium. The companies had been tightlipped about their partnership, though we did uncover the relationship and provide more detail in a report we published in May.
Lithium is doing a couple of things here with its pickup of Social Dynamx. First, the company has been looking to move from internal, community-based support models for some time. While Lithium did partner with Social Dynamx, and the Social Dynamx offering powers the Lithium Response social support tool, owning the product outright can lead to deeper, more process-driven integrations around externally sourced support requests. For example, a deeper integration can allow the tool to identify ‘calls for help’ in social channels outside of Lithium’s communities, such as Twitter, and pull that individual (and his question or issue) into either a structured agent-assisted channel or a community-based support network. The notion is to deeply embed the ability to identify and scale cross-platform support requests into the Lithium platform.
Secondly, the move to acquire seems somewhat defensive. As competitors like Jive Software look to move from internal social collaboration into other areas like marketing and support (like Lithium has been doing over the past several quarters), this acquisition knocks out a potential agnostic partner for other social players. Lithium not only adds features, but also takes an easier route to wresting them away from other enterprise social vendors.
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