GamesBeat

Tagged acquires social network Hi5

We’re seeing some social network consolidation happening: Tagged has acquired Hi5. The move will double Tagged’s online community from 10 million to 20 million active users.

The deal ends Hi5’s attempt to transform itself from an international social network to an online gaming community squaring off against Facebook. That turnaround effort was headed by Alex St. John, a gaming guru and former president and chief operating officer of Hi5. Terms of the deal were not disclosed.

Hi5 is well past its peak active user count, having fallen from 50 million or so to 10 million. Full told, San Francisco-based Hi5 has more than 230 million registered users, while Tagged has more than 100 million registered users. Both companies will continue to operate as two independent and freestanding brands, with updates arriving in the coming months. San Francisco-based Tagged is a network for meeting new people through social games, custom profiles, and virtual gifts.

“An opportunity of this magnitude is uncommon and exciting as the addition of Hi5 immediately doubles our overall active user base and grows combined registered users past 330 million members,” said Greg Tseng, Tagged co-founder and chief executive, in a statement. “Hi5’s global footprint complements Tagged’s and instantly builds on our leadership position as the world’s first, largest and best social network to meet new people.”

St. John said that Tagged is the perfect home for Hi5 as it continues to prove itself as a major contender in social. Hi5 was created in 2003 with the help of Stanford doctoral candidates Johann Schleier-Smith and Greg Tseng. But in 2005, Tseng and Schleier-Smith decided to dedicate themselves full-time to Tagged.

St. John was a colorful character. In the picture above, he wrestled a champion Sumo wrestler as part of a publicity stunt at a game trade show. Hi5 raised a round of $14 million in 2010, when it had about 40 million monthly active users and was trying to square off against giant Facebook, which had 500 million users at the time. St. John is not expected to continue at Tagged. Reached by email, St. John said his goal is “to ensure that the transition goes as smoothly as possible.”

[Update: Tseng said in an interview that he and his partner Schleier-Smith gave Hi5 office space in its early days and helped the company until it moved out in early 2005. They launched Tagged in October 2004 as a social network. But Facebook won those wars and Tagged repositioned itself as a social discovery site, which includes dating, games and features aimed at helping people meet new people, rather than engage with existing friends.

Tagged has about 175 employees and will only pick up a few Hi5 employees. "This is our fourth acquisition this year and this was for the user base," Tseng said.

Tseng said that at some point, maybe by the second quarter, the two sites will be consolidated into a single product with "two front ends." So people can continue to sign into Hi5 or Tagged. Tseng said Tagged's user base has been growing. ]


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