Wix.com Ltd. acquired online art community DeviantArt for $36 million, gaining expertise to build a community around its main web product and increase traffic.
Wix, headquartered in Tel Aviv, is a cloud-based web development platform with more than 100 million users. It offers free and premium subscriptions for its core product.
Wix President Nir Zohar said “DeviantArt has a robust, extremely loyal community. Their brand is extremely strong. We have 100 million users but we don’t have the same kind of community in terms of having the tools and ability to understand how to get people engaged and upload content to the same extent that they do.”
DeviantArt, founded in Los Angeles in 2000, has more than 40 million registered members, and its users have posted about 325 million individual pieces of original art. Once integration is complete, users of DeviantArt will be able to more quickly create Wix websites featuring their creations, and Wix users will eventually have faster ways to post art directly to DeviantArt’s galleries, said Zohar.
“This combined effort with Wix creates new opportunities for innovation never before seen on the internet,” DeviantArt co-founder and Chief Executive Officer Angelo Sotira said in a press release.
DeviantArt makes money through selling ads on its website, premium subscriptions and from sales of art created by its members.
After reporting earnings earlier this month, Zohar said the company could acquire or partner with companies that add technology and teams. Last month, the company bought Flok, a customer loyalty and engagement platform. At the end of 2016, the company had $172 million in cash on its balance sheet.
Following the DeviantArt acquisition, the company’s biggest to date, Wix increased revenue outlook for 2017 by $8 million to between $417 million and $419 million and cut its free cash flow outlook by $8 million to between $63 million and $64 million to reflect more investment in research and development, marketing, integration costs, and other transaction-related expenses. The purchase price includes taking on a $3 million of assumed liabilities.