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A woman takes pictures with Nokia’s new smartphone, the Lumia 1020, with a 41-megapixel camera, after its unveiling in New York, July 11, 2013. Toronto-based Keek Inc. was an early entrant in what is now a sought-after corner of social media, the sharing of short videos. (A keek is a Scottish term for a quick peek.) Keek’s user base is soaring, with more than 45 million users worldwide as of last month.SHANNON STAPLETON/Reuters

Social video start-up Keek Inc. is seeking a new round of financing at a lofty valuation, but pulling it off will require the Toronto company to convince investors it can withstand the challenges to its business from Facebook Inc. and Twitter.

Keek is not yet publicly traded, so it is seeking money from institutions and wealthy individuals who invest in private companies. Bankers at Morgan Stanley are setting up meetings with investors for the proposed financing, and the valuation expectations have been set very high, said two people familiar with the plan.

The potential valuation range that is being put forward is $600-million to $900-million, these people said. If Keek can find the interest, the size of the financing is likely be significantly larger than the $18-million it raised in January.

A valuation in that ballpark would be a huge win for the two-year-old company, which was founded in 2011 by entrepreneur Isaac Raichyk. The company, which allows users to create and share 36-second video updates on their phones or tablets, has yet to attract significant interest from large, established technology venture capital companies outside Toronto.

The company is seeking money just as competition in its business intensifies.

Keek was an early entrant in what is now a sought-after corner of social media, the sharing of short videos. (A keek is a Scottish term for a quick peek.) Keek's user base is soaring, with more than 45 million users worldwide as of last month.

Maintaining that growth as new competition jumps into the space is the trick. Twitter launched its Vine application, enabling sharing of six-second videos, in January. That did not seem to slow Keek too much. It said in June that the Keek platform registered 24 million users in the previous four months. Vine, by comparison, said in early June that it had brought on 13 million users since its January launch.

Now, however, Facebook's popular Instagram app is also offering video.

Keek's appeal is based on giving users the ability to share videos with a minimum of clicks and fuss, and on its longer clips, backers say.

"Adoption of the Keek platform is on the top end of what we expected," said Rob Richards, co-founder of Plazacorp Ventures, an early investor in Keek. "We didn't expect it to mushroom so fast. It's a testament to how well they executed on the product."

The money from the latest investment round is expected to be earmarked in large part to help Keek monetize its product. Once that is done, and revenue is rolling in, an initial public offering could be the next step.

Mr. Richards sees the competition as a boon. He believes Keek can hold its own against the Facebook and Twitter video products.

"We don't think we're losing anyone to those services," he said. People "try them and get attracted to using video, and then they hear about Keek and think this is the real thing."

Twitter and Facebook's new focus on video raises the prospect that other big Web companies will look at buying Keek to ensure they have a solid offering.

"For us as investors, this is great," Mr. Richards said.

Despite its success, the company has kept a pretty low profile, and it's not widely known to investors outside technology circles. Representatives of Keek did not return messages seeking comment.

Mr. Raichyk recently told TechCrunch that he was unfazed by the challenge from Facebook and Twitter.

"Our growth has accelerated during the same period that Vine's been active," he told TechCrunch. "We believe the next couple of years is when social video will rule, and we're definitely leading the space."

(Boyd Erman is a Globe and Mail Capital Markets Reporter & Streetwise Columnist.)

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