Social Media Ad Network LifeStreet Acquires Ad Network from Competitor SocialCash

LifeStreet Media, a social media ad network, announced last week that it will acquire the ad network of its chief competitor, SocialCash.

Both LifeStreet, which is based in San Carlos, Calif., and SocialCash, based in San Francisco, operate ad networks that serve ads almost exclusively to Facebook apps. LifeStreet launched its network in late 2008 and achieved a run rate of more than $40 million by the end of 2009, and claims an audience of more than 100 million globally, according to CEO Mitchell Weisman.

LifeStreet media employs about 60 people, and SocialCash about 15. Precisely what remains of SocialCash following the acquisition is unclear, though sources say it is preparing to launch a new product. Terms of the deal were not disclosed.

“SocialCash has been a terrific competitor for us and I think they’ll be a great partner,” said Weisman.

The business of serving ads to Facebook apps is, not surprisingly, a growing one with only a handful of participants. Weisman said that aside from helping app developers make a profit through advertising, his company has become a de facto consultant to many of them.

“An app developer’s worst nightmare is running afoul of the rules and getting shut down or penalized,” he said. “This has been a competitive differentiator for us, being a compliant ad network that is in the business of following the rules.”

Weisman said that “the vast majority” of his company’s revenue came from serving ads to Facebook apps, but that it was also in talks with MySpace, Bebo and other social networks.

Correction: An earlier version of this story stated LifeStreet will acquire SocialCash. Rather, it’s acquiring SocialCash’s ad network; the company will continue to exist independently.