Sunday, June 23, 2024

Shopify Acquires Threads.com Amid Naming Confusion with Meta

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  • Shopify has acquired Sequoia-backed Threads.com, a business communication startup.
  • The acquisition follows confusion caused by Meta’s social network named Threads.
  • Threads.com team joins Shopify to “tinker at scale.”

Shopify has officially acquired Threads.com, a Sequoia Capital-backed startup known for its Slack-like business communication platform.

The announcement was made on Threads.com’s website, though the financial terms of the deal remain undisclosed. Alongside the acquisition news, Threads.com revealed that its team will now join Shopify, marking a new chapter for the startup.

Threads.com, which launched its product in stealth mode in 2019, quickly became a notable player in the business communication space, securing $10.5 million in funding.

However, the launch of Meta’s social network, also named Threads, thrust the startup into an unexpected spotlight. This wasn’t Meta’s first product with that name; in 2019, Meta introduced an Instagram companion app called Threads, which was later shut down in 2021.

After Meta launched its new social network named Threads, the startup faced significant branding challenges. Threads.com hinted at the possibility of selling its domain name but did not clarify whether the domain was sold to Meta, Shopify, or another entity.

Despite this ambiguity, the startup acknowledged that continuing independently would have necessitated a rebrand, which influenced its decision to consider acquisition offers.

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Threads.com experienced a surge in attention and app downloads due to the naming confusion. According to data from analytics firm data.ai, the Threads.com app was downloaded 880,000 times globally on iOS between July 6 and July 12 alone.

On Android, the app surpassed one million lifetime downloads, even though it had minimal downloads prior to Meta’s social network launch. Many users mistakenly downloaded Threads.com’s app, thinking it was Meta’s new social network.

The startup’s co-founder and CEO, Rousseau Kazi, who spent six years working at Facebook, commented on the situation last year. He noted that “Threads” is a powerful and internet-native term, making it a fitting choice for Meta’s attempt at creating a digital public square.

This overlap underscored the inherent value of the name and the complications it introduced for Threads.com.

Threads.com revealed that several companies approached them with acquisition offers following Meta’s launch of Threads. Historically, the startup had declined such offers, but this time, they saw an opportunity to avoid the time-consuming process of rebranding and leverage the rapid technological advances in the industry.

Ultimately, Shopify’s proposal was the most appealing, offering the team a chance to work on larger-scale projects.

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Shopify’s CEO, Tobi Lutke, welcomed Kazi and his team but did not elaborate on how Threads.com’s product would be integrated into Shopify’s ecosystem.

This leaves some questions about the future functionality and direction of Threads.com under Shopify’s umbrella.

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Emily Parker
Emily Parker
Emily Parker is a seasoned tech consultant with a proven track record of delivering innovative solutions to clients across various industries. With a deep understanding of emerging technologies and their practical applications, Emily excels in guiding businesses through digital transformation initiatives. Her expertise lies in leveraging data analytics, cloud computing, and cybersecurity to optimize processes, drive efficiency, and enhance overall business performance. Known for her strategic vision and collaborative approach, Emily works closely with stakeholders to identify opportunities and implement tailored solutions that meet the unique needs of each organization. As a trusted advisor, she is committed to staying ahead of industry trends and empowering clients to embrace technological advancements for sustainable growth.

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