Chat platform Kik Messenger is eyeing a $125 million initial coin offering (ICO) after raising more than $50 million in a pre-sale open to accredited investors.
Earlier this year, Kik announced it would become the first mainstream social media app to create its own cryptocurrency. The chat app, which was developed by Canadian developer Kik Interactive, had more than 300 million registered users as of 2016. The platform’s native currency is Kin, an Ethereum-based ERC20 token, and will have a creation cap of 10 trillion units.
Kik has now successfully concluded the presale to its token distribution event, raising $50 million from select accredited investors, including Pantera Capital, Polychain Capital, and Blockchain Capital. These firms purchased 488 billion Kin at a 30% discount from the general ICO price.
Kik founder and CEO Ted Livingston believes that Kin will help make cryptocurrency mainstream:
Kin will fuel new experiences in communications, information, and commerce inside of Kik, and will also serve as a foundation for a new decentralized ecosystem of digital services, bringing a fair and sustainable business model to the market.
Indeed, Kik’s decision to raise funding through an ICO is indicative of the growing trend among technology startups to raise money through ICOs rather than traditional channels. Ryan Zurrer, principal and venture partner at Polychain Capital, said he believes the Kik ICO is a “seminal moment” for the cryptocurrency industry:
Kik is by far the largest consumer company to enter the cryptocurrency space, and this is a seminal moment for the industry….We have been impressed with Kik’s thoughtful approach to the creation and distribution of Kin, and have confidence that the team will execute their vision of creating a decentralized ecosystem of digital services through Kin.
On September 12, the Kik ICO will open to ordinary investors. To participate in the ICO, contributors must pre-register by September 9. As part of the registration process, users must list a government identification number such as a passport or social security number, although they do not have to seek accreditation as the Filecoin ICO required.
During this phase of the crowdsale, Kik will sell 512 billion Kin for $75 million, bringing the total ICO distribution to 1 trillion. At the end of the token distribution event, Kik expects to have raised a total of $125 million, making it one of the highest-grossing token sales to date.