Rakuten lead $100m investment in Pinterest

Rakuten are continuing their habit of swallowing up Western ecommerce properties and their latest investment is a cool $100 million in Pinterest. The investment is led by Rakuten in partnership with a number of other investors.

Pinterest might be surprising as an ecommerce opportunity, but as Seamus Whittingham, ChannelAdvisor EMEA MD said: “The site is already more commercial than Facebook and Twitter. In fact, at least half of the content and activity on Pinterest is product-related with the conversations much more likely to consist of “I love this dress” than the usual sports talk or “I love my cat” chatter“.

Hiroshi Mikitani,Rakuten CEO echoed this sentiment commenting “While some may see e-commerce as a straightforward vending machine-like experience, we believe it is a living process where both retailers and consumers can communicate, discover, and curate to make the experience more entertaining. We see tremendous synergies between Pinterest’s vision and Rakuten’s model for e-commerce. Rakuten looks forward to introducing Pinterest to the Japanese market as well as other markets around the world“.

The surprising part of the investment is that it now values Pinterest at between $1 billion and $1.5 billion. However Pinterest already has a revenue stream as they collect an affiliate payments on purchases users make via the site. That makes them more interesting than Facebook or Twitter who are still trying to figure out how to effectively monetise themselves.

Pinterest still have a long way to go before anyone can tell if the investment was worthwhile. The site was only founded in 2010 and whatever revenues they have will be relatively small. They also have the thorny copyright issue to negotiate – anyone can Pin any image they choose on Pinterest, but what if the image is subject to commercial licenses?

One thing is for sure though, Rakuten wouldn’t have led the investment if they didn’t think that either Pinterest would be profitable in it’s own right, or that it would be valuable enough in driving sales from the Rakuten group of ecommerce properties they could justify the investment that way.