Messaging company Kik acquires fashion app Blynk

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Kik Interactive Inc. has acquired Toronto fashion app Blynk and its four-person team, the messaging company is expected to announce as early as Monday.

It's only the third acquisition made by the startup in Waterloo, Ont., since the company's founding in 2009; the first was Relay GIF Messenger in 2014, and mobile game development company GameMix in the summer of 2015.

Dollar figures on the Blynk deal were not disclosed. Though Blynk was not a highly capitalized company, it had won money and awards in startup competitions in Canada and the United States.

Blynk, founded in 2013 by Jaclyn Ling and Shums Kassam, uses a Tinder-like swipe interface to help users sort their personal style. The app shows a variety of outfits to users, who can swipe left to hate and right to love, and over time the app narrows its suggestions based on your votes to show you fewer of the things you dislike.

"What they've built capabilities-wise fits extremely well with what we've built here at Kik," said Jae Kim, the relatively new head of strategy at Kik (he joined about three months ago). The startup already had a Kik chatbot, blynkstyle, which will be enhanced so that its swiping system will be a feature native to the Kik app, which currently relies mainly on text replies for interaction.

Like Facebook, Kik has begun adding apps and services alongside its core features, all in the hopes of leveraging a captive audience to turn itself into a centralizing hub for the smorgasbord of services offered on the rest of the consumer Internet.

In August, Kik raised $50-million in a venture-funding round led by China's Tencent, which operates the hugely popular WeChat app. Kik CEO Ted Livingston has frequently used WeChat as a shorthand for what he wants his company to become: a central platform for everything from chat to shopping to running a business.

Kik's demographic strength is a good match for Blynk, Mr. Kim says. U.S. teens make up a huge chunk of Kik's 240 million registered users (the company says some 40 per cent of U.S. teens use Kik). And among that demographic, Mr. Kim says Kik's data show fashion and clothing are a top-three category of discussion, particularly when you count "engagement" or time spent on a subject.

Mr. Kim says that Blynk was collecting three to five million swipes a month on its iOS and Android apps, impressive considering its relatively low installation base (Blynk's Android app had fewer than 10,000 downloads). "People would swipe 90 times per session," Mr. Kim said.

Blynk's business plan was to make money on affiliate link sales (where a retailer shares a commission fee on any purchases made through a link referral). That hasn't come to pass as hoped, but Mr. Kim says Kik can use the fashion preference and purchase data that Blynk collects to help build Kik's profile of its users.

"We think that every interaction will help us create a more personalized experience. After purchase, what happens? They may not necessarily be with the same article of clothing, may not necessarily be with the particular brand," Mr. Kim said. Because Kik can collect everything from customer feedback and other shopping activity that takes place on its platform, it will amass a lot of valuable consumer insights on a cohort who's spending power will only increase. "Having that all hosted by us enables us to allow that to happen in a way that's very transparent," Mr. Kim said.

Mr. Kim is himself an interesting addition to Kik, which is rapidly expanding (it expects to double its 130 head count during 2016). Previously the head of strategy at competing chat app Line, Mr. Kim has built the kinds of ancillary services that Kik is focused on now. For example, Line is not only the dominant chat app in Japan and Taiwan, it is also a pop-culture phenomenon with physical retail stores dedicated to characters featured in the app.

Kik declined to discuss long-rumoured plans to introduce payments to the service, but as the company moves to make shopping and retail more central, users should expect not to wait too long for the ability to buy things using Kik.