Late last month, Amazon announced its intent to acquire Goodreads, a social reading service at which Kyusik Chung (InSITE ’08) serves as VP of Operations and Business Development. Since launching in January 2007, Goodreads has grown to over 17 million users, 23 million reviews, and 525 million books cataloged. The company seeks to increase user engagement with books by allowing users to recommend books, compare what they are reading, keep track of what they have read and would like to read, form book clubs and find new books in genres of interest based on proprietary algorithms. Prior to its acquisition by Amazon, Goodreads had raised $2.75 million in funding from a range of investors, including True Ventures.
Strategically, Amazon and Goodreads are a natural fit and complement each other exceedingly well. Both companies share a passion for reinventing reading and expanding the discovery and discussion of books. Since its founding, Amazon has transformed the book distribution model by dramatically increasing access, affordability and availability of books globally. The company has used the Kindle to further reinvent both reading and the way authors and publishers reach a global audience. In this way, Amazon has developed its leadership position within the book retail and distribution segment. In contrast, Goodreads has become the leader in book discovery and social sharing, representing the segment of the reading experience that comes before and after purchasing and reading, largely outside of Amazon’s strengths. Goodreads helps readers connect with fellow book lovers to find and share books they love. Goodreads also helps authors and publishers connect with readers and promote the discovery of their books by a wider audience.
Over the last several weeks, concerns have arisen amongst Goodreads’ avid user base regarding the potential commercialization of the Goodreads platform and attempts by Amazon to mine users’ data to seek to influence their book purchases. Despite these concerns, Amazon has the opportunity to utilize its broad distribution capabilities online and through its Kindle platform to deliver enhanced an user experience to a significantly broader consumer base. Furthermore, Amazon offers Goodreads an incredible opportunity to continue to expand its technology platform.
For additional insights from Mr. Chung regarding Goodreads and his role at the company, please visit http://tinyurl.com/c67o8ff for the transcript from a recent interview with him.
This post was written by Mark Krafft, Columbia MBA 2013
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