Data Intelligence, Business Analytics
If Web 3.0 is about big data, then DataSift will surely be among the next generation of companies. The organization, which is most visibly the company behind TweetMeme, has today secured $6 million in funding.
DataSift describes itself as “a real-time social-data mining platform”; translated into English it means it takes a number of social data sources, including Twitter (DataSift is one of only two companies globally licensed by Twitter to re-syndicate its content), Facebook, WordPress and others and allows users to mine that data in a highly granular way.
The company, founded by Nick Halstead and based in Reading, U.K., some four years ago, was behind early news aggregators like Favor.it and TweetMeme, the re-tweet service seen across the web. It was the experience from that which allowed him to build DataSift.
“Almost from the day that we launched TweetMeme, I asked myself if a B2C news aggregator was going to sell for $1 billion. The answer was obviously no.”
Do to data processing what Amazon did to server rental
Instead Mr. Halstead looked at how companies like Amazon had disrupted server rental and came up with a plan to do the same to data analysis. “For me the technology isn’t the game changer. For me it is approaching data processing in a democratized way. There are any number of companies that will sell you data, but they will typically charge you a five-figure sum minimum.
“What the web has been very good at is disrupting these models. I wanted to apply that to data processing. If you want to process a small amount of data, you pay only for that. It depends on time and complexity. If you are a small business and you want to do something reasonably simple, why should you pay a premium? If you can then take what you find and sell it commercially then that is a great model.”
Investor Mark Suster of GRP Partners who co-lead the $6 million investment with Roger Ehrenberg at IA Ventures, wrote enthusiastically about the acquisition on his blog and on the significance of Twitter compared to other social networks (in essence it is open and asymmetric).
Think of DataSift as turning the fire-hose into a cost-effective and manageable tap of running water. Or in utility speak, they are transmission and we are last-mile distribution.
And better yet, the company has a product that will turn the stream into a lake. What does that mean? The Twitter stream like most others is ephemeral. If you don’t bottle it as it passes by you it’s gone. DataSift has a product that builds a permanent database for you of just the information you want to capture.
According to the company, “the $6 million investment will resource the advanced development of the DataSift platform, enable DataSift to grow its operations in North America, and expand its worldwide sales support.”
Mr. Halstead said there were other plans which would be announced shortly.
“There are other social networks and we have some very big names to announce. There are also some other kinds of data. A lot of the data is short form tweets, or long form blog posts. There is also a lot of other data types about behavior of users, that might be click data, that might be liking data. That data is just as valuable.”
Is it a worry for Mr. Halstead that if the company generates too much value, that Twitter will simply move into the space in much the same way that the company muscled into the Twitter client space?
Mr. Halstead was phlegmatic. “Yes of course it is possible, but we have a very good relationship with Twitter. We signed a long-term contract with them.”
Twitter appears, so far, to be a keen backer of the project. CEO Dick Costello offered his congratulations to Mr. Halstead and is quoted in the public announcement of the deal.