Facebook Buys Giphy For $400 Million
Facebook is one of the leading and most used social media platform. It owns other apps such as Instagram, Messenger, WhatsApp, to mention a few that are most popular among others. On the other hand, Giphy is a well known online library and a creator of gifs, animated videos and provides platforms for other apps. According to reports from Axios, Facebook paid Giphy $400 million to acquire the company. These reports prove to be true because Facebook just made it official on its company blog.
Vishal Shah announced the deal in a blog post and said that people communicate in meaningful and creative ways through GIFs and stickers and express themselves better. He also added that bringing Giphy’s team creativity and talent together with Facebook will increase visual communication and connections between people, as they have monitored the use of Gifs and stickers by people, and they have seen a real purpose. Vishal Shah is the Vice President of Instagram’s product.
According to close sources, Facebook is not fully acquiring Giphy, but it is more of a partnership. Giphy is retaining its brand. Most operations of Giphy will remain the same. Giphy’s users will still be able to upload Gifs. According to Facebook, half of Griphy’s traffic comes from its apps, especially Facebook’s Instagram. Hence most of Griphy’s content has been in use for the longest time with the help of Facebook and its apps. Most likely, the reason as to why Facebook decided to team up with Griphy to combine efforts and be of benefit to each other.
This time Facebook succeeded in their negotiations. Back in 2015, Facebook had tried to buy Griphy for the first time. It seems like Griphy was not appealed by the offer that was presented because they rejected it. This is the second time Facebook has approached Griphy, and well, they are officially a team.
Besides Griphy partnering with Facebook or instead, being Acquired by Facebook, it was doing quite well as an independent company. It had hundreds of millions of users daily. Giphy shares billions of Gifs. Even before the integration, Facebook was sourcing the Griphy’s services via Whatsapp, Messenger, and Instagram. We would see these Facebook apps using Gifs from Griphy. In return, Griphy generates its income through content that is branded. According to reports, Giphy’s recent private valuations were around $600 million.
Besides Griphy being a popular service, partnering with Facebook will be a benefit on its side. This is because Facebook has ads and marketing platforms. A combination of these and Griphys content, then will Griphy be not only a popular service but also a very profitable company as well. Facebook, on the other hand, will entice more users on its apps as well as increase the connections and communications of its existing users.
As Griphy will maintain its branding rights, the first integration will be witnessed via Facebook’s Instagram platform. Griphy will be a team with Instagram where users will be able to send Gifs and stickers directly and easily through Direct message and in their Insta stories.
According to Vishal Shah, nothing will change for Griphy users; the developers and API Partners of Griphy will continue to access the Griphy API as usual, as well as the creative community for Griphy will continue creating great content. But there is uncertainty because other services such as Twitter, Reedit, Pinterest Slack, and many more rely on Griphy for the supply of Gifs. Although there is an assurance from Facebook that things will not change, there is some tension about the future because some of these services are direct competitors with Facebook.