As social media becomes more mainstream, many companies — especially marketers and advertisers — are desperately trying to figure out how to measure social influence online, apart from simply counting the number of Twitter followers a person has. Klout is one of the services trying to help them do that, and it just got some powerful help of its own: the San Francisco-based startup announced early Monday that it has closed an $8.5-million funding round from Silicon Valley powerhouse Kleiner Perkins Caulfield Byers, and is adding Kleiner partner Bing Gordon to its board of directors.
Klout started out focusing on Twitter, after founder and CEO Joe Fernandez had jaw surgery and spent his recovery posting on the social network and trying to figure out who to follow. The company has since added Facebook activity and LinkedIn content to its database, and is looking to add other social networks and activity as well. “People are really starting to understand the importance of influence on the social web,” Fernandez said in an email. “Obviously getting someone like KP to lead the round is some validation of that, but more importantly you can see it in the fact that we are working with companies like Virgin America, Disney, Fox, Audi and many others.”
Several companies have already experimented with offering special deals to customers who have high Klout scores, in an attempt to bolster word-of-mouth marketing via social media. The Palms Hotel and Casino has used Klout to put together a social influence group, while Virgin had discounts on flights to San Francisco. As social-media activity becomes more commonplace — thanks in part to the rapid growth of Facebook and Twitter — many companies are trying to figure out how to harness that phenomenon as a marketing tool. Salesforce.com CEO Marc Benioff has even talked about using social-networking influence as a method of determining how much to pay his employees.
As Bindu Reddy of MyLikes wrote recently at GigaOM, the social web needs something like Google’s Page Rank as a way of filtering out the noise, and Klout is trying to supply that by measuring a user’s “reach” and other metrics. The latest funding brings the total amount Klout has raised to $10 million, including a round of $1.5 million raised from Zelkova Ventures last April.
In addition to Kleiner Perkins, the most recent financing includes Greycroft Partners, as well as some of the angel investors who previously backed the company, including ff Asset Management, Tom McInerney, Paige Craig, Bobby Yazdani and Howard Lindzon. Klout competes with other social-media analytics companies including PeerIndex (which Techmeme editor Mahendra Palsule looked at recently) and Twinfluence. Twitter has also said it is working on its own influence ranking system.
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