Password Manager LastPass Acquires Xmarks

LastPass, a cross-platform password manager, has acquired the social bookmarking and browser synchronization service Xmarks.

The San Francisco-based Xmarks has been in the midst of some tumult of late, as it closed down in September and then quickly opened back up again in an effort to keep its service running for a large group of active users.

That happened after user outcry, spurring the company to try to stay afloat.

SInce then, Xmarks has been trying to land itself safely.

The start-up had multiple offers to keep the operation running, as well as pledges from almost 30,000 fans willing to pay $10 to $20 a year for a new “freemium” business model.

Enter LastPass, based in Vienna, Va., whose CEO Joe Siegrist said in an interview that he wanted to help keep the service operating.

“They had a large dedicated audience, but their free offering and advertising model was not working,” he said. “We really want to figure something out that could keep it going.”

Siegrist said LastPass offered a robust free service, but relied on a small group of users who pay to upgrade to a premium offering.

The browser add-on for cross-platform synchronization operates in the cloud.

And that is going to be the fate of Xmarks–which had been called Foxmarks initially.

It had been seed-funded in 2006 by well-known entrepreneur Mitch Kapor and also got an additional investment from First Round Capital.

Xmarks garnered another $5 million in funding from Redpoint Ventures in 2008,

That year, it also hired Silicon Valley entrepreneur James Joaquin as CEO, whose job it was to carve out a business with Xmarks’ assets, including using its mass of data.

Xmarks had certainly been growing its user base and bookmarked Web addresses strongly, via a browser widget that recorded bookmarking information.

Earlier this year, it tried out an advertising product called SearchBoost, which gave advertisers additional analytics about their ads, as well as organic search results.

But all that ultimately did not translate into a viable business for Xmarks.

“We think this will make a great ending and beginning for Xmarks,” said Joaquin.

Both Xmarks and LastPass declined to provide financial details of the transaction.

Here is the blog post by LastPass and Xmarks about the integration: