Popular chat app Kik has secured $50m funding boost from Chinese web giant Tencent, owner of rival social media apps WeChat and QQ.
This funding puts Canada-based Kik’s total at $120.5M. Kik is hoping the investment will help boost competitiveness and emulate WeChat’s success in North America.
In a statement, Ted Livingston Kik’s CEO, said: “Today we’re announcing that Tencent, maker of WeChat (Weixin), has invested $50 million in our company, Kik.. This process started a year ago, when our board asked us if a partnership with a large company might give us an advantage in winning the chat race. At first I was hesitant. I was confident we could win the race alone. But, keeping in line with Kik’s principle of considering all the options, I eventually agreed to take a look.
Livingston added that the move propels Kik into the same league as Facebook and Snapchat in the social mobile arena, as Tencent’s investment values the start-up at over $1bn.
“Today, there are only five other companies in the world that see the future like we do: Tencent, Line, Facebook, Snapchat, and Telegram. One of them owns the largest internet market in the world. We couldn’t be more excited to partner with them as we run this race.”
Ontario-based company Kik competes with other messaging services like Whatsapp, Snapchat or the Facebook Messenger app.
Tencent is a Chinese firm with a focus on internet products including online sales, social networks and China’s most popular messenger service WeChat.
The Canadian start-up is particularly popular with teenage users and has been looking for a strategic partner for some time.
The company says 70% of its 240 million users are between 13 and 24 years old, and that 40% of US teenagers use Kik on their smartphones.
“Young Americans are a large group with unmet needs. We can’t think of a better group to be building for,” said Livingston, founder and chief executive of Kik.
Livingston explained Tencent was the best partner because its messenger service WeChat allows users not merely to connect with friends but also integrates options like shopping, ordering taxis and playing games.
“It was clear they understood chat deeply, making them a great sounding board,” Livingston said in a blog post.