Twitter buys Niche, an ad network for Vine stars, for ~ $50 million in cash and stock

Twitter has acquired Niche, an ad network that helps social media stars make money, for more than $50 million in cash and stock, including employee retention incentives, multiple sources familiar with the deal tell Business Insider.

Niche had term sheets and was about to raise a new round of financing at a valuation that was around $50 million when Twitter swooped in.

Rob Fishman and Darren Lachtman co-founded Niche in late 2013. Fishman previously managed social media for The Huffington Post then sold a company, Kingfish Labs, to Buzzfeed in a stock deal.

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He and Lachtman noticed individual followings on sites like Instagram and Vine were growing rapidly, and brands were interested in advertising on the platforms. They launched Niche to become a a new type of advertising agency, connecting brands with influential people online. Vine and Instagram celebrities work with Niche's advertising partners to promote their products in a natural way to their followers.

"I'm literally making a living off this," one Vine star, Cody Johns, told Business Insider in March. One campaign he ran with Niche netted him roughly $20,000.

As of March, Niche was working with with 50 advertising clients and it ran campaigns for American Eagle and Universal Studios. After its first six months, the company generated $750,000 in gross revenue. Brands were paying Fishman's team anywhere between $15,000 and $150,000 per month to devise and execute effective Vine, Tumblr and Instagram campaigns for them. A Niche investor says the company was expected to generate more than 1 million in net revenue this year.

Here's more on Niche, and how it's helping Vine stars (and ultimately Twitter now) generate a lot of advertising revenue.