Wow. That’s what people are saying when they see the news, and I can’t blame them!
Kik’s “demise” comes as a big shock and is really going to rock the world of all those people who used the app regularly, not to mention the folks who have been working on the product for many, many years that now have no job!
While it is surprising, I guess it’s not totally unexpected when you take a step back and look at the big picture.
Kik is a massive chat app, one of the most used, fastest growing, etc., but it’s still just a chat app. It’s like an Internet utility that people expect to have, but will never pay for. The worst support is the support you have to give to people who pay little to nothing; they are both the worst and most demanding “customers”.
But Kik was growing and was seemingly successful, so why kill it?
Here are my guesses/thoughts as to what’s really going on:
The potential payoff of winning with Kin is so massive that doing anything else is pointless and a distraction
I think blockchain is a dumb hype-train waste of time, but people are putting big money and big bets on it. If it works out and the world converts and Kin is the biggest and/or most used Crypto, that’s a game changer. Go big or go home.
I just watched “The Big Short” again on Netflix yesterday, one of my favourite movies, and everyone thought the people making the short were out of their minds, but it paid off because they read the writing on the wall and also recognized the potential of the deal.
If they have the opportunity to be the biggest and the best in something so world changing, then nothing else matters but achieving that goal. Shed the distractions, weights and costs of everything else and go all in.
They want to be the ones to take a stand against the SEC and literally change the world if they win
They also happen to be the one in the spotlight and actually being attacked by the SEC as well, but I can see someone like Ted wanting to stand up for something and trying to change the world instead of just trying to make money. This is one of those once in a lifetime things where you can have a big impact.
On the other hand, this could be purely the only strategic move to defend against the SEC. I don’t know what they can do, but if they can cause personal liability or jail time then I’d also rather throw my company out the window in order to defend myself.
Kik wasn’t going anywhere, couldn’t be monetized well enough, and was a general massive headache to run
Kik has been up for awhile and it’s really, really hard to make money off a chat app. They made the bet that they could be the “WeChat” of North America, but I think it’s come to the realiziation that we aren’t China and we aren’t going to interact with our messaging apps like they do in Asia.
Kik has tried a lot of different things to make money, but at a point you realize that it’s just not going anywhere and it’s become a zombie. It doesn’t matter how awesome your team is or how fast your app is growing if it can’t make money.
As I alluded to earlier as well, supporting free users suck. Not to mention how much crap they must have to deal with on the backend in policing the system or literally dealing with the police as I have to imagine that Kik was used for a lot of nefarious things. As someone who takes an occasional scroll down 4Chan, I see Kik groups pushed on there a lot for things that it wouldn’t want on there.
Kik was getting boring/not a fun challenge/big companies suck/investors want big returns
Ok so there are a lot of things in this one. Let’s start with the last one first. Investors exist for returns and even though Kik had it’s ICO, it still had it’s original investors as far as I’m aware. Those investors have some form of control and they want big money and it was becoming clear that the chat wasn’t going to get them that, but they had another opportunity to follow, so why not go for that. Investors have no problem burning down a cash generating business in order for a shot for massive returns if they can, and I don’t think Kik was a cash generating business. This refocusing could be in part because of the investors.
The other parts of this one are more Ted focused. I really like Ted, I respect him and think he’s a good guy. He seems like someone who isn’t driven by money, but by his own personal drives and desires to do something big or world changing.
As all humans, we are slaves to our emotions, drives and wants. Most people can’t take on their drives and wants because of the risks involved and the money required, but the brave entrepreneurs and Do’ers can, even if it’s a great risk, because to them it’s not, it’s a risk to stay the same or do shit you don’t like or don’t want to do. I get that.
Kik was probably getting boring and/or frustrating. It was going nowhere, it was a painful slog with no end in sight, and after the excitement, challenges and learnings of running a growing business begins to stop, then it’s no longer fun, a joy, a learning experience or anything but really exhausting work. Entrepreneurs want a challenge, but they also want an opportunity to be associated with that challenge. The opportunity may have been gone, they proved it wasn’t going anywhere, so why bother continuing just for the public’s sake?
Big companies also suck, most entrepreneurs hate being in big companies or end up leaving or switching roles or fail to adapt when their companies grow big. You can learn a lot as you grow, there are big challenges to running a company, especially with that many people, but once the lessons are learned, it just becomes a job. Everyone wants to go back down to that “elite, small team” to do awesome things again and have fun. Get rid of the processes, the cruft, the meetings and just do. That’s what I loved about his language, that “elite” team. It could also just be spin, but I want to believe it’s not.
My optimistic thoughts are that Ted proved that Kik wasn’t working, got tired of running a big ship that wasn’t fun, and changed focus to something with much more opportunity and a chance to change the world.
Maybe I’m just totally wrong
I like the guy and want to hope he’s doing the great things he wants to do and has the bravery to say “fuck it” and just do them, because he doesn’t care what other people think. I’m an optimist and I respect entrepreneurs who get shit done and who take a stand.
The pessimistic view is that he is just sick and tired and fed-up and/or turtling up against the SEC because the US can try and put him in jail for life or something stupid like that.
I never worked for Kik and I never really used Kik, but I paid attention to what they were up to and I knew people who did work with them, so I got to see them from various angles.
At the end of the day, if Kin really is as big an opportunity as it appears, then every other reason doesn’t matter and you focus on the big win.
I wish Ted the best in his fight!