Reddit’s acquisition spree continues this morning, with the company bringing in-house the technology of crowdsourcing firm SpikeTrap. Terms of the deal were not disclosed, but Reddit says SpikeTrap’s AI-based contextual analysis and tools will help Reddit improve in areas such as ad quality scoring and augment the prediction models that power auto-bidding.
The deal marks Reddit’s growing investment in its advertising business, as it aims to make it easier for advertisers to target relevant audiences based on interests. The deal also comes at a time when Apple’s user privacy tools, app tracking transparency, or the effectiveness of online advertising on major tech platforms such as ATT, Facebook and Snap, are affecting consumers’ opting out of ad personalization.
Founded in 2016 by Kieran Sean Fitzpatrick, Virgilio Pigliucci and Andrea Wattani, San Francisco-based SpikeTrap has 20 employees, according to its website. The company touts its proprietary Clair AI technology, which can extract the “signal from the noise” of structured datasets. Combined with its Knowledge Graph, the company offers a range of solutions in contextual ad targeting, impact measurement, brand safety monitoring and other research and data-as-a-service solutions.
In particular, it promotes technology that can do things like identify elements that represent a piece of content in movies, TV shows, games, franchises, and more, even if they aren’t explicitly mentioned. The company claims that this AI can deal with ambiguities, abbreviations and acronyms. Meanwhile, its emotion AI can also detect the sentiment surrounding a post, such as excitement, sarcasm or venom — something Reddit has struggled with for years, often having to shut down hateful and vile subreddits that engage in harassment. And what other advertisers want to avoid. Most recently, it banned the r/donaldtrump subreddit after the January 6 riots.
“The richness of the conversation in our 100,000+ active communities is what makes Reddit so unique and so valuable to advertisers. We believe targeting relevant audiences based on interests and the context of the conversations they’re having will help advertisers reach the right people in the most efficient ways,” said Reddit EVP of ad monetization, Shareek Rizvi, in a statement about the deal. . “We’ve been actively investing in solutions in this direction for some time, and this acquisition complements Reddit’s capabilities, taking it to the next level. I’m thrilled to welcome the SpikeTrap team to the Reddit family,” added Rizvi.
Today’s announcement follows other recent acquisitions by Reddit, including Spell, a platform for running machine learning experiments, in June, and natural language processing company MeaningCloud in July. With the former, Reddit can use ML technology to improve its capabilities in a number of areas, including recommendations for its new Discover tab, its security work, and its targeted advertising business. MeaningCloud, like SpikeTrap, also touted its ability to extract meaning from unstructured content, indicating that Reddit has broader goals in making rapid improvements in this area, particularly in relation to its ability to serve advertisers.
Reddit says SpikeTrap’s 15-person team has already joined the company and will lead several projects in its advertising business. Currently, Reddit is currently focused on integrating SpikeTrap’s tools, technologies and resources with Reddit, and the company says the go-forward strategy for its commerce business will be part of this transition.
“Our mission is to contextualize language at scale and in real time to help creators, brands and platforms truly understand and meaningfully engage with their audiences,” SpikeTrap CEO and co-founder Kieran Fitzpatrick said in a statement. “We look forward to scaling these efforts further as part of Reddit.”
SpikeTrap raised $3.5 million in a seed round in 2020, but did not disclose a valuation, a Reddit spokesperson confirmed. Spiketrap’s seed round was led by Susa, 645, Pathbreaker and Anorak. Following the acquisition, the SpikeTrap team will take senior positions in Reddit’s product and engineering organization, where former SpikeTrap CEO and co-founder Kieran Fitzpatrick will join as director of product.