Facebook acquired mobile commerce startup Karma, which makes apps for gifting friends and family. 16 employees of the startup will be joining Facebook, and further enhance Facebook monetization effort on mobile platforms.
Karma is one of several new services to apply web technologies to picking out, purchasing, and delivering presents. Once a user loads the app, Karma connects with Facebook and sees the data from the users' Facebook friends to birthdays, graduations, weddings, and other life events. Karma then suggests gifts to the user from its curated catalog. Once a purchase is made, the friend receives a message requesting his or her physical address and offering the option to customize the gift, or choosing to donate the money instead.
By doing this, Karma has deep data about people, their age, location, "likes" and users' habits, which is used to provide recommendations based on what gifts other people with similar characteristics like. That data is used by Karma to build a "social commerce" platform. This platform was attractive to Facebook, as it seeks to ramp up revenue as a newly public company.