Only a few weeks after hitting 50 million users, the popular mobile messaging service Kik has received a new chunk of funding to fuel its impressive growth.
Kik announced today that it has raised $19.5 million in a second round of funding led by Foundation Capital. It’s a significant step beyond Kik’s existing $8 million funding, but Ted Livingston, the company’s founder and chief executive, isn’t letting it get to his head.
“For us it’s a step along the way,” he said in an interview with VentureBeat last week. “What’s most exciting for us is leading the HTML5 revolution — the money is just like a checkbox.”
Kik offers cross-platform mobile messaging apps for iPhone, Android, and Windows Phone, but the company’s most recent focus has been on HTML5-powered apps within the core Kik client, which the company calls “Cards.” So far the company has Cards for things like watching YouTube, browsing Reddit, or sketching with your friends. Since they’re HTML5-based, Kik can add new Cards and update them across all platforms without waiting for app store approval.
And of course, the Cards helpfully keep users within Kik’s app. As of a few weeks ago, Kik’s users have installed more than 25 million Cards so far. Livingston sees a future for monetizing within Kik’s Cards via advertisements and mobile shopping, while he hopes to keep the core messaging service a “pure” experience.
Kik is also adding Foundation Capital partner Anamitra Banerji to its board of directors, who also led Twitter’s monetization efforts, including promoted tweets and promoted trends. At this point, Livingston believes he’s an excellent fit to help Kik monetize as well.
The company will use the funding to building up Kik’s infrastructure and hire people for its ambitious HTML5 project (and similar far-reaching endeavors). Kik currently has less than 30 employees, but Livingston is gung-ho about expanding if he finds the right candidates: “If we could hire 30 engineers tomorrow and they’re all brilliant, we’d hire all of them,” he told me.
Livingston wasn’t too worried about the threat of Kik’s main competitor, Whatsapp, when we chatted a few weeks ago:
They’re much bigger today, but they have much weaker network effects. They’re not a product company … half their users are on crappy feature phones. They’re waking up to this idea that it was all about the messenger, but now it’s about the platform around the messenger. … They’re in no position to compete at the platform level.
Kik currently only has one office in Waterloo, Ontario, but Livingston says he hopes to expand with more offices in places like New York, Berlin, and San Francisco as the company becomes more of a platform.