The mobile messaging space, already hot with a number of start-ups on a roll and last week’s purchase of Beluga by Facebook, got a little hotter today with news that Kik has raised $ 8 million from Union Square Ventures, RRE Ventures and Spark Capital. The Waterloo-based start-up, which was founded in the shadows of Research in Motion, will use the money to expand its development efforts and add to its head count. Fred Wilson of Union Square Ventures and RRE Ventures’ Adam Ludwin will join Kik’s board.
The Series A funding by some well respected names shows there’s little slow up in the mobile messaging space. In fact, things are accelerating as companies gear up for South By Southwest, which is turning into a major showcase for group messaging apps, just like it highlighted the check-in location market last year. My colleague Darrell had a good round up of some of the group messaging apps.
Kik joins GroupMe, FastSociety, PingChat, TextPlus and others along with new start-ups like Ditto and Yobongo, which launched last week. And then there’s Beluga, which is now owned by Facebook, but will also be showing off new features at SXSW. RIM is also rumored to expanding its footprint in group messaging by possibly extending its BBM messaging client to other platforms. RIM, by the way, sued Kik for patent infringement last year, cutting off the app on the BlackBerry platform. Kik has denied the charges and countersued. Despite the loss of the BlackBerry platform, Kik is up to 3.4 million uniquely registered users since launching in October.
Ted Livingston, CEO of Kik, said the space is hot right now because the smartphone helps address a need for more private network communications among friends, something Facebook and Twitter don’t currently address well. He expects Kik will hold its place among its competitors by emphasizing its speed of messaging, which it owes to its own architecture. It is also focusing on the way people naturally communicate. The company just announced it is adding group messaging to Kik for up to ten users. It is not forcing users to create groups, instead allowing them to just add members to existing conversations. Kik is also enabling photo sharing, but only with photos that have been taken during a conversation, to underscore real-time communications.
“We feel that mobile messaging is the next frontier of social,” Livingston said. “It’s a huge space and we think we’re at the front of it.”
Kik, which previously raises $ 1.6 million in Angel funding, has some great backers. But I wonder how this whole market will shake out. There are so many messaging apps right now, it’s hard to see how they will all survive. MG Siegler at TechCrunch called the onslaught of apps the App Wall, in which consumers ultimately get overwhelmed by the choices. Users don’t need half a dozen messaging apps. In fact, even if they opt for a messaging app over SMS at all, they’ll likely want to narrow it down to one, maybe two solutions. That will make it tough for smaller competitors to compete. And it makes you wonder how well Facebook will utilize its Beluga acquisition. If it can integrate it into its current messaging platform, it could put a big hurt on many competitors.
Still, I think it’s early days and the funding announcements by Kik and earlier by GroupMe suggest that we have a lot of growth ahead. The winners will have to move quickly but also figure out elegant ways to make their systems stand out in an ever more crowded field.
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