Summary:

Businesses are hungry to understand more about the public perception of their products and services by tapping social networking sources. That demand is why DataSift, which sorts through tons of social network data, garnered $7.2 million in additional funding from existing backers.

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The desire of companies to better understand the public perception of their products and reputation via social media shows no sign of abating. That’s why DataSift, the company that sorts through tons of Twitter, Facebook  and other social network data, has garnered an additional $7.2 million in venture funding from existing backers GRP Partners and IA Ventures.

That money comes as a follow-on to the $6 million already raised in a Series A round last summer, and $1.5 million in seed funding.  The new cash will be used for product development and to hire more engineers, customer service and sales reps, the company said. DataSift, which launched in the U.K. in 2010, opened a San Francisco office early this year.
DataSift and Gnip are the only companies authorized by Twitter to funnel and parse the Twitter firehose of social media data — information that many companies see as critical for planning service, promotion and marketing campaigns and then gauging their success (or lack thereof).

Companies from consumer electronics manufacturers to fast food chains all watch the Twitter feed — as well as Facebook, blogs, YouTube and other social network sources — collecting data that they then analyze along with their own internal metrics to see how online (or in-store) promotions are working. In early April, DataSift said it was also integrating with Newscred so that customers could study how news and perceptions spread in the media.

In a statement, DataSift CEO Robert Bailey said the company had not been actively seeking new financing but that GRP and IA Ventures came forward with this offer. The fact that they stepped up helps eliminate distraction that comes with raising new funding, he added.

Expect DataSift to use its a some of this money to add new data sources and services, as it and Gnip try to one-up each other. In February, DataSift announced its ability to sort through two years into Twitter data — Gnip can only go back 30 days. In mid April, Gnip announced an exclusive partnership with Tumblr, the fast-growing blogging site. It seems that arms race is bound to continue.

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