Kakao, the South Korean IM giant sought to partner up with American corporations such as Google and Facebook to name a few as a way to reach US smartphone users.
Also, Kakao will consider an initial public offering starting this year. They denied the IPO rumor that was circling around earlier in 2012 – the company raised funds from investors to the amount of 20 billion ($18.4 million USD) in 2012.
The two companies bought 3.6 million and 2 million shares respectively at the price of 20,000 KRW per share. The CEO of Kakao said that they decided to invest in Kakao in anticipation of KakaoTalk’s future growth. The three companies will cooperate in the future with regards to the mobile game and platform spaces.
It was anticipated last year that this funding will come on the heels of SK Planet’s takeover of Madsmart*, the maker of KakaoTalk’s ex-rival., TicToc. Since the three major telcos of Korea lost a lot of their customers to KakaoTalk (you can read the story here).
Recently, SK Planet, LG Uplus and KT teamed up to launch ‘Joyn’ to fight Kakao, which is currently dominating the Korean IM service scene. You can read more about it here. With the launch of KakaoPage, as we wrote about on 2 January, it seems that Kakao will continue to grow. We'll write more about this in Part II with regards to WhatsApp and Line (and potentially with Viber, Tango, and TalkBox)
*Madsmart was a privately held IM and interactive platform developer before it was acquired. It received 3-4 acquisition offers from Korean companies last year, and engaged in talks with more than 10 venture capital firms based in South Korea and overseas to raise 4-5 billion KRW in March of last year. At that time, 67% of the share was held by the CEO and the remaining 33% was held by an angel investor. In 2011 it received 350 million KRW from a Seoul-based venture capital, Bon Angels. By 2014, it is expected that Madsmart will bring over 12 billion KRW. It had approximately 15 million users in 2012.