Plaiced, a community-focused advertising platform, has acquired creator marketplace Clutch in a deal that brings 800 content creators under its umbrella. 

The acquisition complements Plaiced’s existing network of 150 million community members and expands the company’s strategy to scale local, authentic advertising.

The deal, which emerged through one of Plaiced’s mom-focused community groups, has already driven a significant surge in deal sizes on Clutch’s platform. 

While technical integration challenges have led the companies to operate independently for now, Plaiced CEO Kaaveh Shoamanesh sees the acquisition as a crucial step in enabling brands like L’Oréal and Nike to target specific zip codes while accessing authentic community voices.

“The opportunity was presented from the community,” says Kaaveh. “One of the mom groups knew the owner of this UGC platform, and through that community-based relationship, they ended up connecting us.”

He believes Plaiced can take the owner of those communities and offer them new opportunities to make money by making them under its creator arm. From the other perspective, Plaiced can sprinkle Clutch’s creators into its different community advertising campaigns.

The deal aligns with Plaiced’s mission to scale localized user-generated content globally. “Our values align in the sense that we both want to make sure that we elevate the real creators, the real communities,” says Kaaveh. “We’re very passionate about bringing them value in terms of money as well, helping their quality of life.”

For brands, the combined entity promises to deliver localized UGC at scale. “We’ve combined [UGC and community advertising at scale], which brands like because they know who they’re speaking with,” Kaaveh states.

Integration Challenges Signal Shift in Strategy

The integration of Clutch into Plaiced’s ecosystem has been challenging, particularly on the technical front. Initial plans to merge the platforms’ technologies or create an extension of Plaiced’s self-serve platform proved more complex than anticipated.

“We realized that our technologies are built on very different foundations,” says Kaaveh. “It is very costly and challenging for us to do it to a point where we could probably build something from scratch for roughly the same price.”

The company opted to let the platforms operate independently while focusing on operational improvements, including restructuring Clutch’s pricing model to ensure sustainable margins.

“The pricing for our margins doesn’t work. We have certain overheads that don’t allow us to have that limited margin that existed before,” Kaaveh explains. According to him, the new model may include management fees for labor-intensive services and adjusted per-asset pricing.

For future acquisitions, Plaiced plans to enhance its integration strategy. “[Those planning acquisitions] can hire someone contractually for a few weeks leading up to the acquisition, a few weeks after, just to spend full time integrating everything,” Kaaveh advises. “That way, at least, you can work on the revenue generation faster.”

Expanding Creator Opportunities While Maintaining Existing Partnerships

Following the Clutch acquisition, Plaiced is implementing a dual strategy: preserving existing creator relationships while expanding revenue opportunities through cross-platform synergies. 

The company maintains Clutch creators’ current brand partnerships and compensation structures while working to improve payment efficiency.

“We have not adjusted anything to affect their earnings,” says Kaaveh. “We haven’t cleaned the house, and we said all the brands were working before. Let’s start from scratch. We left that fully for the creators to continue to work with them.”

The acquisition is already driving larger deal sizes across both platforms. “Our deal sizes are much bigger now,” Kaaveh notes. “There has been an average of 500% to 700% increase on the Clutch side, and on the Plaiced side, maybe 10% to 15% increase.”

New monetization opportunities, including a merchandising platform and premium affiliate partnerships, are on the horizon. “We’re talking about potentially amalgamating some aspects [of merchandise] with our technology that’ll allow creators to create their merchandise and then sell them in the platform to their followers,” explains Kaaveh.

The company is focused on improving cash flow management to benefit creators. “We are working on asking brands to pay us upfront so we can pay the creators faster and have ourselves paid faster,” says Kaaveh.

Cross-selling between platforms is becoming standard practice. “We always entertain and mention to each brand if they’re interested in partaking in the other business in every deal we have,” Kaaveh adds.

Lessons from the Acquisition

The acquisition of Clutch has provided Plaiced with valuable M&A insights as it eyes future growth opportunities.

“Make sure you always know what you’re buying,” says Kaaveh. “We should have gone further with [due diligence]. We needed an integration person to help integrate the different accounts over to us, and interviewing some of the existing customers should have been part of the due diligence process.”

The acquisition is already driving job creation. “We hired three, four people since the acquisition,” Kaaveh notes. “One person specifically, Cal, was one of our first users on Plaiced three years ago with a gaming community of 300,000 people on Discord. Clutch enabled us to hire him to run Clutch for us. It was a nice full circle moment.”

Plaiced aims to perfect its execution with partners like Chorus Entertainment and Hearst Media before expanding geographically beyond the United States and Canada into Europe. The company’s focus remains on scaling niche advertising.

“Niche advertising at scale is something that more and more companies, brands, and agencies are yearning for,” explains Kaaveh. “The root of attention is connection and community. If you can do that at scale, you’re doing well.”