OSLO (Reuters) - Kuddle, a picture sharing app for children, will launch a crowdfunding initiative on Thursday aimed at raising $7.35 million to pay for further growth of its service, Chief Executive Ole Vidar Hestaas said on Wednesday.
The Norwegian firm, which bills itself as a child friendly rival to Facebook's Instagram, is in the process of hiring 40 to 50 people in its newly established Silicon Valley office and has recently hired a country manager for Brazil.
Valuing the company at $28.7 million before the issue of new shares, Kuddle will use crowdfunding platform Fundable.com to sell a 20.4 percent stake, in a move that bypasses traditional funding methods.
"We feel this is an exciting way to raise capital. We have had serious talks with major venture funds but have decided to grow the company somewhat more before we let them in. Right now we would have to give away a too big part of the company," Hestaas said.
"The money will be used for an even more aggressive push into the U.S. market, which is our fastest growing market and where we see the best potential for growth going forward," he added. The minimum purchase for each investor is $10,000.
Launched last August, Kuddle lets parents monitor what their children publish and keeps access to content restricted. The firm missed a target of attracting one million users by the end of 2014, but says it's on track to hit that number within the next two months.
"It was an ambitious goal, but unfortunately it has taken a bit longer than we hoped. But we are rapidly closing in on our target and if we maintain our present growth rate we will reach one million users in early March and pass three million users around October," Hestaas said.
"With the enormous interest we are experiencing from potential investors right now, I think it will be quite easy to raise the amount we are asking for," he added.
(Reporting by Joachim Dagenborg, editing by Terje Solsvik)