Korean chat app company, Kakao, has disclosed that its 2013 revenue hit $203 million, netting $59 million in profits. 84 percent of the revenue was generated from commission through games, commerce, and digital content. The remaining revenue was generated from ads.
Compared to 2012, Kakao’s revenue grew by 4.6 times while profit grew by 10 times in 2013. Total registered user count on KakaoTalk is at 140 million with over 426 games on its games platform contributed by 217 game developers and partners. Despite posting strong figures, Kakao’s revenue still falls behind Line which reported $338 million in revenue in 2013. Line also boasts to have over 350 million registered users. Line, though, remains mum about its profit.
In February, WSJ reported that Kakao is preparing its initial public offering which could see the Korean messaging application raise as much as $1 billion at a valuation of more than $2 billion.
Coincidentally, in the same month, rumors were spreading in Vietnam that the country’s biggest telco was looking to acquire Kakao for $5 billion. The rumor was quickly dismissed by Kakao co-CEO Sirgoo Lee, who told Tech in Asia that the Korean startup has not heard of such a deal and is currently not engaged in talks.
The last few months have been a craze of exits and investments in the messaging app arena, with Facebook acquiring Whatsapp for $19 billion and Rakuten acquiring Viber for $900 million. Ecommerce giant Alibaba also made a $215 million investment in Tango.
Speaking at last April’s Startup Asia Singapore, Lee told the audience that Kakao would “like to IPO one day” but would rather focus on growing and expanding its business. He also lamented that on hindsight Kakao could have “focused on global expansion a bit more aggressively.”
Perhaps 2014 is the year that Kakao will finally take a close look at its exit options. We shall see.
We have reached out to Kakao for comments and will update if we hear back. Update: Kakao’s PR replied that its “IPO is still set for sometime mid next year.”Editing by J.T. Quigley