Startups

Facebook Buys Mobile Data Analytics Company Onavo, Reportedly For Up To $200M… And (Finally?) Gets Its Office In Israel

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Big news for a Monday/late Sunday night (depending on where you are): Onavo, the Tel Aviv-based mobile analytics company, has just announced that it has been acquired by Facebook. Onavo will become the anchor for Facebook in Israel — its first office in the country. Terms of the deal have not been disclosed; we are trying to find out. Right now we’re seeing reports of between $100 million and $200 million.

Specifically, Israeli paper Calcalist is reporting $150-200 million; other sources tell us the range is more like $100-$200 million. Both Calcalist and another Israeli paper, The Marker, are writing that some 30 Onavo employees will join Facebook and work in the company’s new office in the country (which is Onavo’s office, for now).

Onavo, which was founded in 2010, has two parts to its business: a consumer-facing apps to help optimise device and app performance and battery life on iOS and Android devices; and an analytics business for mobile publishers to chart how well its own apps are performing, and to chart that against apps of its competitors. It had raised some $13 million in venture funding from investors like Sequoia, Horizons Ventures, Motorola and Magma Venture Partners.

The rationale for the deal is easy to see on a few levels.

Facebook has been focusing on building up its mobile business, which is seeing the most growth and is the platform that most users in developing markets are turning to first when signing up for and using the social networking service. So this means beefing up Facebook’s mobile operations in general, but also for making Facebook as usable as possible in these emerging markets. Today, Onavo’s technology is focused only on smartphones rather than feature phones, but what it does on those devices is help users track how well those devices work, in terms of battery life and so on.

Those apps will continue to be sold, but that technology can also be used by Facebook itself to optimise what it offers to its users. (One possible pitch: Use Facebook on Mobile to see the world, and we’ll help you save money on your mobile data bills!)

Indeed, the company’s co-founders, Guy Rosen (CEO) and Roi Tiger (CTO) even cite Facebook’s recent Internet.org initiative, which also targets those on the less fortunate side of the digital divide, in the company’s short blog post announcing the deal (below). “Today, we’re eager to take the next step and make an even bigger impact by supporting Facebook’s mission to connect the world,” the pair write.

More practically, Onavo will also give the company a much deeper technology bench to measure how those mobile services are working — who is using them, as well as how to make them work in the most optimised way on mobile devices. This can be applied in a number of areas both for basic user experience and commercial ends. (One commercial end: performance of mobile ads.) Right now Onavo is all about smartphones. Will that extend to feature devices as well longer term, I wonder?

It will also be a very strong play to attract more mobile developers to Facebook overall, much like Facebook’s acquisition of Parse last year. Just as Parse gave Facebook its first paid B2B service for developers, it will be interesting to see whether Facebook expand that B2B offering with its new Onavo assets. (For the record, an Onavo spokesperson has just declined to comment on these kinds of details.)

Facebook was reportedly interested in buying Waze, the social/mobile mapping company that eventually got sold to Google. One of the sticking points of that deal (reportedly) was that Facebook wanted all of Waze in Menlo Park’s HQ. Today’s deal shows that Facebook clearly isn’t adverse to having a presence in the country after all.

But Onavo is not the first Israeli company that Facebook has acquired. There have been two others: one also to further its mobile operations, with feature phone interface developer Snaptu (bought for up to $70 million in March 2011); and one to expand its photo sharing and storage platform, acquiring facial recognition specialist Face.com in June 2012 for $50-60 million.

Update: A Facebook spokesperson has emailed me a comment that basically underscores all of the above: “Onavo will be an exciting addition to Facebook. We expect Onavo’s data compression technology to play a central role in our mission to connect more people to the internet, and their analytic tools will help us provide better, more efficient mobile products.” He also pointed to the Onavo blog post, which we have embedded below.

We are excited to announce that Facebook has agreed to acquire our company.

Three years ago, we started Onavo with the goal of helping today’s technology consumers and companies work more efficiently in a mobile world. We developed the award-winning Onavo mobile utility apps, and later launched Onavo Insights, the first mobile market intelligence service based on real engagement data. Our service helps people save money through more efficient use of data, and also helps developers, large and small, design better experiences for people.

We’ve built world-class products and a remarkably talented team which has pioneered important breakthroughs in data compression technology and mobile analytics. Today, we’re eager to take the next step and make an even bigger impact by supporting Facebook’s mission to connect the world.

As you know, Facebook and other mobile technology leaders recently launched Internet.org, formalizing Facebook’s commitment to improving access to the internet for the next 5 billion people — this is a challenge we’re also passionate about.

We’re excited to join their team, and hope to play a critical role in reaching one of Internet.org’s most significant goals – using data more efficiently, so that more people around the world can connect and share. When the transaction closes, we plan to continue running the Onavo mobile utility apps as a standalone brand. As always, we remain committed to the privacy of people who use our application and that commitment will not change.

We are incredibly proud of the talented team we have assembled, and, recognizing this, Onavo’s Tel-Aviv office will remain open for business and will become Facebook’s new Israeli office.

We’ll continue to advance the work we are doing in collaboration with Facebook’s great team. Thank you to everyone who has joined us on this journey. We’d like to extend a special thanks to our investors, who believed in us and in our vision from the early days. We’re excited for what’s next.

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