March 4, 2008 3:37 PM PST

Demand Media buys social software maker Pluck

Posted by Stefanie Olsen

Demand Media, an aggregator of specialized Web sites, has acquired social-networking software company Pluck, according to the company.

The deal closed late Monday night. Demand Media did not disclose financial details, but various reports pegged the deal worth between $50 million and $75 million.

Richard Rosenblatt, founder of Demand Media and former MySpace CEO, said the acquisition of Pluck marks a new direction for his company. Demand Media has built a collection of roughly 60 niche Web sites that produce content and video on everything from golfing to gardening tips. By buying Austin, Texas-based Pluck, a supplier of social-networking software to media companies such as USA Today and Fox, Demand Media plans to distribute its own content to a much wider audience.

"Before, we were 100 percent focused on building out our network. Now we have a way to distribute that content off our own network," Rosenblatt said in an interview.

"At some point, we want to offer every Web site the ability to get social media tools and content integrated into their site," he added.

Demand Media's first product with Pluck tools will be a social media site launched in partnership with Lance Armstrong, called Livestrong.com. Demand Media plans to introduce a beta of the site in May.

Los Angeles-based Demand Media, whose network attracts roughly 60 million monthly visitors by Google Analytics' measure, has raised $350 million from a group of investors that includes Goldman Sachs and Spectrum Partners, according to Rosenblatt. He said that he plans to take his company public next year if the public markets are healthy. Demand Media made about $150 million in revenue last year and is profitable, he said.