Rollercoaster ride as CEO of hit messaging startup Kik
We’re taking a slightly different approach to our second feature in the Inspiring Entrepreneurs series. A fortnight ago, Boris interviewed Reed Hastings on his business lessons and experience, but now I’m shaking it up with a look at a 26-year-old founder who is disrupting the mobile and social networking spaces: Kik CEO and founder Ted Livingston.
Livingston’s journey as an entrepreneur is far shorter than Hastings and other more experienced business leaders, and yet he has toasted highs, experienced gut-wrenching lows and come out on the other side with a mobile messaging business that has over 80 million registered users.
Kik, for those of you who don’t know of it, has its core user base in the US, and markets itself as a universal messaging service that doesn’t require a phone number for registration. Users on iOS, Android, Windows Phone and other platforms can swap text messages, photos and play games and view content for free over the service.
It began at RIM
Waterloo, Canada-based Kik recently passed 80 million users, which was given particular significance from local media who noted that it took the 4-and-a-half year old startup past BlackBerry and its BBM mobile messaging solution.
That not only signifies the missed opportunity that BlackBerry is desperately trying to make up for now — following its botched weekend launch of BBM for iOS and Android — but it sees Livingston’s own startup over take the company that gave him his start in the technology world.
“I went to university in Waterloo in 2005 for engineering. That’s only important because, as part of the engineering degree there, you have to complete six four-month internships over your course,” Livingston tells TNW in an interview.
“In my third co-op term I got a job at RIM (now BlackBerry), I started in May 2007, about a month before the iPhone initially came out. That was really cool because I got to see mobile very early, while also it was part of RIM’s policy to give everybody — including students — BlackBerrys with full data plans.
RIM HQ (as was) (credit: Simon Hayter/Getty Images)
“So, at a time when data plans were ridiculously expensive and smartphones were ridiculously expensive — to the point that no consumer had them — here I was, having just turned twenty, with a smartphone and a full data plan.”
“I not only got to see mobile very early, but I got to live in a fully-penetrated mobile world very early,” he explains.
An all-round mobile education
At the time, RIM was the dominant smartphone company and Livingston settled into a “process-heavy” job within the company, where he worked tirelessly all hours.
“By day I did my job, but at night I wrote a piece of software to automate my job,” he recalls. “At the end of my four-month term, they brought me on part-time to run a team that built out a system around the software I’d developed at night.”
Livingston returned for his fourth and fifth intern spells with RIM, occupying a “really amazing” position within the consumer product management team. Enjoying the work and highly-regarded by the team, thing were going well.
“There were only 15 people on the team, and I was the youngest by about 10 years. This was at a time when consumer was completely dismissed by RIM — enterprise was the main focus — so I got to work with all of the individual product managers on all of their products. That was an amazing experience and opportunity… and an awesome company.”
‘The best piece of advice I ever got’
Livingston did that for a year. Two-thirds of the way through his degree at this point, he considered dropping out of university to become a product manager, before he got a dose of what proved to be sage advice which shaped his future.
“One of the luckiest moments in my life happened,” he says, as his then-boss pulled him aside and told the promising young intern to forget any plans of quitting his studies:
Ted, I know you love it here and are doing really well, but don’t drop out and come on full-time. You really understand mobile, you should leave and start your own company.
“That was the best piece of individual advice ever got in my life,” Livingston says.
He duly took it and vowed to start a company when his finished his third and final placement with RIM in December 2008.
Kik Music: iTunes for your BlackBerry
The idea for Kik Music, which was initially called Unsycned, came directly from his time at RIM.
“I looked at my BlackBerry and thought, ‘I love this device, but it’s so unfair that I also have to carry an iPod when my friends with iPhones just need to carry an iPhone. The music experience was so bad on BlackBerry, that I decided to build a service to fix it,” Livingston says.
He headed back to the campus digs to round up a founding team. Having tried to start companies with friends unsuccessfully in the past, he took a room at the new VeloCity dorm — a project that housed 70 entrepreneurial-minded students together — at the University of Waterloo.
The VeloCity Project Exhibition at the University of Waterloo (credit: Joey de Villa/Flickr)
After putting in $45,000 of his own money — a large chunk of which was an inheritance — Livingston rounded up an initial team, that included co-founder Chris Best, who is now Kik CTO, and got to work on the service.
Livingston and Best’s “killer music service for BlackBerry” aimed to put all of a user’s music on a phone, but also turn the device into portable music player which could plug into a PC to play music and playlists without needing to sync.
The duo planned to integrate with BBM to let users share tracks, and they opened discussions with music labels to gain the necessary rights.
“We were going to be the first music service in the world to let you share music legally with your friends,” says Livingston, pointing out that users would be permitted to share tracks with a limited number of plays available for friends.
Livingston graduated and the company continued on, developing a music player for BlackBerry while its legal team embarked on the long and complicated process of working with music labels. Indeed, the latter business proved to be particularly lengthy given the ground-breaking deal that lay in prospect.
In late 2009, seeing a growth in a new breed of cross-platform messaging services like Ping and WhatsApp — which quickly clocked one million users each — the Kik team realized that BBM alone wouldn’t be enough.
Livingston and his team spent a few months “begging” RIM to open its popular messaging service to other channels, but the company had no interest.
Credit: PUNIT PARANJPE/AFP/Getty Images
“They looked at BBM as a key reason that people bought BlackBerry phones, but, for us, BBM already existed for other platforms — it was called WhatsApp or Ping chat — it’s only a matter of time, we thought.”
In the end, Kik took it upon themselves to build a cross-platform messaging app because RIM wouldn’t budge.
“We told them we’d have to build our own cross-platform chat… and they said: ‘go ahead’,” Livingston recalls with a laugh.
Messaging begins to take center stage
Kik Music raised a $1 million seed funding round in January 2010, roughly a year after Livingston had first embarked on the project. Already, he had dropped out of his final year of studies to devote himself to the project 100%.
At that point, the company was focused on three things: building a cross-platform music player and a cross-platform chat service for sharing tracks, while working on licensing deals with record labels.
“While we were waiting for the music licensing to go through — it took some time because it was so unique — we decided to launch a beta of the messaging app,” Livingston says.
The Kik Chat app launched in April 2010 for iOS and BlackBerry initially. It performed reasonably with around 50,000 users, but the Kik team felt it could be a lot better.
By October 2010, the music product was essentially done and Kik Chat had continued to chug along — but the company was waiting on a closure to its dealings with the labels.
“The licensing had basically got to the point where we had the final longform agreement in principle,” Livingston says. “But we’d been working on a second version of the chat app, and figured we could get the second version out and then follow-up right after with the music product.”
So in October 2010, Kik launched the second version of its messaging app — and the company’s future changed almost instantly.
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