Facebook shares open lower, buys another tech start-up

Facebook has bought new tech start-up, TBH, for an undisclosed amount. Facebook shares closed the US Tuesday trading session higher but has opened in negative territory, Wednesday.

The social media giant’s latest purchase is one of a number of tech start-ups it has added to it’s stable. There are reportedly a number of reasons the tech giant has made the deal. However, what is certain, is that TBH is an app that connects users in a positive way.

TBH stands for ‘to be honest’.

What does TBH do

The TBH app uses tech already harnessed by Facebook and allows users to send others, anonymous compliments. This is done by users selecting a poll and answering questions like “who would you most like to go a road-trip with” and “Who is most likely to be president”.

In a statement to TechCrunch, Facebook said,

TBH is popular with the teen audience and since launching on the IOS App store, has been downloaded over 5 million times.

How does TBH fit with Facebook

The why of the purchase is an intriguing question. However, some analysts suggest Facebook is working hard to attract the teen user audience the social media site is losing.

Speaking to BBC news, Warwick Business School Analyst Professor Mark Stilton said the purchase represents another example of Facebook buying a potential rival before it “erodes its own user-base.”

By winning over the teen market, Facebook continues to work on growing its user base and profit potential. And that’s good news for investors and users.