Online chat platform operator Kik Interactive agreed to acquire Israel-based chat app developer Rounds yesterday in a deal that will provide exits to electronics producer Samsung and telecommunications company Verizon.
The companies did not disclose the purchase price but Israeli daily Calcalist reported that Kik will pay between $60m and $80m for Rounds, which had raised $24m in funding since it was founded in 2009.
Rounds had built a range of social apps but its lead product was an app that enables up to 12 people to instantly chat in a group through video, and which has more than 40 million users around the world.
Kik, the owner of a chat platform with more than 300 million users, plans to use Rounds’ technology to enhance its expression and group video capabilities, and to grow its global presence.
Dany Fishel, co-founder and chief executive of Rounds, said: “Video is the natural evolution of chat and an integral part of expression and hanging out in real life. We saw Kik as the perfect partner to expand our reach to such a vast audience.
“It is rare when two companies share a similar culture and vision of connecting people through fun, meaningful experiences, and we are eager to build the next great platform together.”
Verizon’s corporate venturing unit, Verizon Ventures, led a $3m round for Rounds in 2008 that included Rhodium and Draper Fisher Jurvetson, before all three joined Samsung’s Samsung Ventures subsidiary for a $12m series B round led by Sequoia Capital in early 2015.