LibraryThing, a Portland-based software company and social platform for booklovers, has acquired Litsy, a mobile app known as the “Instagram for booklovers.”
Tim Spalding founded LibraryThing.com in his Portland apartment in 2005. What began as a tool for him to catalog his own library soon morphed into a social networking platform that allows users to catalog their libraries, provide book reviews, and chat with fellow booklovers. AbeBooks, an online seller of new, used, and rare books, acquired a 40% stake in LibraryThing for an undisclosed sum in 2006, at which time LibraryThing had only 35,000 members.
Though not as big or well known as Amazon-owned Goodreads (even though LibraryThing was founded a full year before Goodreads), LibraryThing has steadily grown over the years by attracting a more serious group of bibliophiles to the platform. The LibraryThing website currently has 2.2 million users, who’ve cataloged more than 123 million books, according to a news release announcing the Litsy acquisition.
Several years ago, LibraryThing also began developing software for libraries and their catalogs. It currently “works with thousands of libraries,” according to its website.
LibraryThing lists nine employees on its website, though it appears to be a distributed team with only four, including Spalding, based in Maine.
Spalding, a Portland resident, did not respond to an email from Maine Startups Insider with questions about the deal. However, he provided some context in a FAQ about the acquisition that was posted this week on LibraryThing’s website.
The acquisition of Litsy, which exists only as a mobile app, will expand LibraryThing’s reach among a demographic distinct from its current users and grow its presence in the book world, including among publishers that currently provide early-review copies of books to LibraryThing users.
“They are different communities that have spread in different ways,” Spalding wrote. “We hope to drive some cross-service exploration, but LibraryThing and Litsy are different places. This difference is a strength. LibraryThing is now working across the book-loving spectrum. It gives us greater profile in the book world, and helps us to serve all kinds of passionate readers.”
Litsy was launched in early 2016 by Jeff LeBlanc and Todd Lawton, who had previously founded the book-themed clothing company Out of Print Clothing, acquired by Penguin Random House in June 2017.
The two services will remain distinct platforms, according to Spalding, though there will be some synergies created on the backend, including providing the Litsy platform with LibraryThing’s more robust cataloging features.
Financial details of the acquisition were not disclosed, “but we can tell you it did not involve company-limiting amounts of money,” Spalding wrote in the FAQ.
In response to a question about LibraryThing’s business model and how Litsy would fit into it, Spalding gave a tl;dr version (“Litsy is cheap to run. We’re happy to be its new owners. And we’re in for the long haul.”) and expanded a bit on the philosophy he’s maintained over the last 13 years running LibraryThing.
The usual pattern for social companies is to “get big fast or die.” You get funded. You spend all your money quickly to get as many users as you can. Then you sell yourself to a larger company who want your community size. In reality, however, the most common path is that the company flames out and dies, everyone loses their data, the community is blown apart, and the founders move onto the next idea.
LibraryThing never followed that approach. From the start, we conserved our resources, and made money by charging members small fees. We didn’t look for a buyout from Amazon or Google. Eventually we found another path to making money—turning some of LibraryThing’s technology and data toward making libraries better. We earn every dollar we make, and we don’t annoy or exploit members to do it.
As things stand, Litsy is large enough to matter to a lot of people, but it’s too small to be significantly “monetized.” Fortunately, it’s also cheap to run—even cheaper now that Litsy can live within the existing LibraryThing infrastructure.
After twelve years of making LibraryThing work, we believe the race is long, and good things with great communities will find their business. We plan to take the same approach with Litsy.
