The social media giant Facebook is on the cusp of a deal to acquire Kustomer, a startup that specializes in chatbots and customer service platforms for enterprises, the Wall Street Journal reports, whereas it’s said that Facebook will pay a little over $1 billion for the New York-based startup.

A Kustomer acquisition by Facebook doesn’t sound startling, given that both companies intersect majorly in the area of chatbots. Over the years, Facebook has sought to build up new business lines after having conquered digital advertising. The social media giant could be looking to acquire and further scale up Kustomer as a new major business.

A $1 billion+ price for Kustomer would also not be out of the box, given that the New York-based startup was valued at $710 million from its last funding round, according to PitchBook data. 

Kustomer is backed by over $174 million in venture funding from investors including Tiger Global, Coatue, Battery Ventures, Redpoint Ventures, and Cisco Ventures. The company was founded in 2015 by serial entrepreneurs Brad Birnbaum and Jeremy Suriel who sold a previous startup to Salesforce before founding Kustomer. 

Apparently, Birnbaum and Suriel are set to score a much bigger monetary win after having sold their previous startup to Salesforce for a price of $80 million.

For now, a formal deal between both parties hasn’t been announced. We’ll update here if it pulls through.

Update: Kustomer has formally announced its acquisition by Facebook, whereas the financial terms of the acquisition aren’t disclosed.

Photo credit: European Parliament, licensed under CC BY-NC-ND 2.0

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