In April 2011, Walmart acquired Kosmix and subsequently formed Walmart Labs, a research and innovation lab focused on building and launching new business models for Walmart.com or Walmart stores. Since then, the division has grown rapidly and now counts over 2000 employees in Silicon Valley.
Fueling the growth of Walmart’s innovation efforts has been a number of M&A transactions. And analyzing the Business Social Graph reveals just how quickly Walmart’s tech acquisition activity has surged over the last three years. The Business Social Graph below highlights Walmart M&A activity between 2008 and 2010, or rather its single acquisition, Vudu, a Benchmark-backed content and media delivery service. It also highlights Amazon’s M&A activity over the same period. And it is in this comparison that the dearth of tech acquisitions becomes readily apparent as Amazon was highly acquisitive over the same period buying companies ranging from Zappos to Fabric.com to AbeBooks. (Orange lines represent acquisitions).
But as the Business Social Graph time-series visualization shows below, the formation of Walmart Labs has served as a catalyst for Walmart’s tech M&A activity. By increasing the timeline to include transactions to-date, the M&A uptick for Walmart becomes very apparent. In fact, Walmart has acquired or taken a majority stake in 15 companies ranging from predictive data analytics (Inkiru) to website optimization (Torbit). Walmart’s most recent acquisition, ad spend SaaS company Adchemy, appears to be its largest. The company had raised nearly $120M in funding from investors including Mayfield Fund and August Capital.
Amazon, of course, has not stood still over the period as well also increasing its M&A activity as well. Among its notable acquisitions over the past three years were Diapers.com parent Quidsi, book recommendation site Goodreads and Bain Capital Ventures-backed mobile robotic fulfillment company Kiva Systems, the three of which were acquired for an aggregate exit value of $1.4B.
Interestingly, when analyzing the Business Social Graph, it becomes apparent that the acquisitions made by Amazon and Walmart are quite different in terms of their strategic focus.
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