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Monday, April 22, 2013

Kik, a Messaging App, Raises Additional $19.5 Million

Kik, a popular mobile messaging app that also lets people share videos, drawings and voice messages, just got a little more gas in the tank for its race against rivals like WhatsApp, GroupMe, MessageMe and Facebook Messenger.

On Monday, Kik, a Canadian company, announced that it had raised $19.5 million in a new round of venture financing, led by Foundation Capital, which invested in Netflix, and with participation by RRE Ventures, Spark Capital and Union Square Ventures. In addition, the company will be getting board advice from Anamitra Banerji, who held the title of Twitter’s first product manager and is now at Foundation Capital. Previously, the company raised close to $10 million in a seed and Series A round; the new infusion brings the company’s total financing to $29.1 million.

Ted Livingston, the company’s chief executive, said that the most recent round of financing was harder than the last two.

“The market for consumer mobile has cooled off a lot from a year ago,” he said. “There’s been a lot of disappointment, and no one is making any money or big exits. Fortunately for us, we had fantastic numbers and growth across all our metrics, so it was very doable.”

According to the company, Kik has more than 50 million users and adds 200,000 each day.

Mr. Livingston said the company was focusing on user growth and branching out with “Kik Cards,” an HTML5-based platform that allows applications to run on top of and within the Kik messaging service. So, for example, users can play games with their friends on Kik or even shop using the messaging application.The company said 25 million Kik Cards had been installed by users.

Those apps on the Kik Card system are crucial to the company’s plan to make money from its free application, said Mr. Livingston.

“We have the resources now to compete and we are determined,” he said.