Mobile Rewards Network Kiip Earns Its Keep With $12 Million In Series C Funding

KiipSeriesCKiip is having its moment. The mobile rewards platform announced its $12 million Series C on Tuesday, bringing its total funding to $32 million.

Led by new investor North Atlantic Capital with participation from US Cellular (also a new investor) and existing investors Verizon Ventures, Relay Ventures, HWVP and True Ventures, the cash is destined to fund growth.

Kiip will bolster its engineering team and bring on more sales and marketing staff, upping its head count from 100 now to whatever makes sense based on need.

The company is approaching profitability, said Kiip’s CEO and founder, Brian Wong. In fact, Kiip was profitable in Q4 2015. But as with many advertising and media-reliant businesses, the first and second quarters were slow. Kiip wasn’t 100% in the black in Q1 or Q2 2016 but flirted with profitability during both quarters.

That helped Kiip raise additional funds, Wong said. Investors respond to stability. But the market can be confusing, with lots of conflicting information that makes it hard to read.

Some companies seem to be doing well – take mobile gaming firm Unity Technologies, for example, which has a large ad platform and just raised a $181 million Series C in July – and others less so. Mobile app marketing platform Fiksu met a somewhat ignominious end when it was quietly swallowed up by a little-known holding company in June.

“There’s not a lot of consensus on how the market is doing, but it’s clear that the companies that aren’t winning are the ones that have been commoditized, whether that’s the product or the pricing,” Wong said. “If you have a differentiated product, though, you’ll do well.”

Kiip integrates directly with first-party apps to help brands capitalize on particular moments within a consumer’s daily life – perhaps as they finish a run or when they need to get to the next level in a game – with contextual ads informed by location data, time of day and behavioral signals.

“Marketers are there in the moment when someone is sharing, but Kiip is there in the moment when someone is living,” Wong said. “And there’s a big difference between explicit sharing and just living your life and using the apps you have.”

Over the last several months, Kiip has rolled out several new ad formats, including a video reward unit and the ability to redeem rewards via Passbook. But the mobile-first data the company collects is the real differentiator, Wong said.

“The data that brands have about people mainly comes from website visits on desktop – you go to, so you must be in the market to buy a car,” he said. “It’s a cookie business. But more and more of a brand’s CRM data is going to originate from mobile-first engagement, not a cookie or a TV.”

Beyond hiring and product development, Kiip also plans to use a portion of the funding to keep focusing on international markets. A partnership with Cheetah Mobile in April expanded Kiip’s footprint to China. Next up, said Wong, is India.

“We’re bullish on India,” he said. “India is quickly becoming another China when it comes to smartphone opportunities.”

Kiip is also contemplating making an acquisition of its own, although what that would entail is still amorphous. But the same environment that makes it awkward for some companies to raise funds presents an opportunity for others to buy them.

“This is the time to look around at smaller teams that are either running out of money or are unable to raise the next round,” Wong said.

Founded in 2010, Kiip is headquartered in San Francisco, with sales offices in New York, Chicago, Los Angeles, London and Las Condas, Chile. Roughly 5,000 apps are integrated with Kiip rewards, including RunKeeper, The Home Depot, Marriott, Taco Bell, Coca-Cola and Clorox.

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