The social bookmarking platform Pinterest, where users curate images by ‘pinning’ them with links and commentary to themed boards, has lifted its value to US $1.5 billion by raising US $100 million in a recent financing round led by a Japanese online retailer, Rakuten Inc.
Reason behind the funding
There has been a sudden increase in use of social media by retailers and other companies to market their products and services. Like Facebook and other social networks, Pinterest too has struggled to generate revenue, but Rakuten’s investment could lead to a deeper integration with corporate partners.
Hiroshi Mikitani, Rakuten’s chief executive, said his firm and Pinterest share the belief that using online marketplaces should be an “entertaining” process that encourages shoppers to explore.
“While some may see e-commerce as a straightforward vending machine-like experience, we believe it is a living process,” Mikitani said in a statement. “We see tremendous synergies between Pinterest’s vision and Rakuten’s model for e-commerce.”
How Pinterest will generate revenue
You must be wondering how the virtual scrapbooking platform is going to generate revenue for an e-commerce site, click here to know the business plan of Rakuten.
Image by: Ruth Tsang via Flickr (CC)