China's Tencent invests $50 mln in Canada's Kik Interactive

TORONTO, Aug 19 (Reuters) - China's Tencent Holdings Ltd
0700.HK has taken a $50 million stake in Kik Interactive, an
investment that values the Canadian mobile messaging company at
more than $1 billion, Kik said on Wednesday.
Kik, a Waterloo, Ontario-based company whose chat platform
is popular with U.S. teens, has long said it aims to emulate the
success of Tencent's WeChat, which has expanded from messaging
to facilitating commerce in China.
The investment from Tencent, China's biggest social network
and online entertainment company, helps justify that ambition,
Kik Chief Executive Ted Livingston said in a phone interview.
"That company that everyone's talking about, they think Kik
can do in the U.S. what they've done in China, that's why
they're investing," he said.
Kik faces stiff competition in mobile chat, with Snapchat
targeting the same teenage audience and Facebook Inc 's FB.O
Messenger and WhatsApp products claiming far more users. But
Livingston is betting on a growing number of add-on services to
keep its 240 million users engaged.
"The more we connect not only people, but also connect
services and business, the more they'll want to stay as they get
older," he said.
While not disclosing the size of the Tencent stake,
Livingston said Kik is "part of the so-called unicorn club," a
term describing private companies with valuations in excess of
$1 billion.
Livingston declined to say when Kik might turn a profit.
Last week it launched a trial product called Jam to connect
users with their favorite musicians, and offers promoted chats
that let advertisers engage directly with users who opt in.
Kik said it plans to use the series D funding - which brings
total funding to $120.5 million - to hire staff in Waterloo and
invest in other chat-based services.