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Moshi Maker Mind Candy Targets U.S. Kids With Relaxation App

Moshi Maker Mind Candy Targets U.S. Kids With Relaxation App

(Bloomberg) -- Mind Candy Ltd., best known for its Moshi Monsters franchise, has raised $12 million from investors and is putting its Petlandia business up for sale to focus on promoting a relaxation and bedtime story app for kids.

Moshi: Sleep and Mindfulness, which counts “Star Trek” actor Patrick Stewart among its voice artists, has 112,000 subscribers and needs new funding to hire additional talent and add roles at the London-based startup, Chief Executive Officer Ian Chambers said.

“The app is profitable, but now we need to extend our growth, particularly in the U.S.,” Chambers said in an interview. “It’s our biggest market by far.”

Mind Candy is in active conversations with buyers for Petlandia, which lets people create personalized storybooks that feature their pets. He expects a deal to close “in the near term,” and didn’t disclose the valuation.

“It’s a huge opportunity for the right company,” Chambers said. “Petlandia was a cash generator and it stopped the downward trend. We sold something like 300,000 personalized books, and we’re incredibly proud of it. But the transition of the business is done now, and we’re well capitalized.”

For about $40 a year, Moshi Sleep subscribers get access to a library of original stories read by professional voice actors and designed to aid a restful night. It’s intentionally audio-only to promote healthy nighttime use, and new content is released weekly. Chambers says that about 70% of Moshi’s 20-to-30-minute stories are listened through to completion.

A subscription-based app with a focus on mental health isn’t an alien concept to Mind Candy. Its founder, Michael Acton Smith, stepped down from his role as CEO in 2014 to co-found meditation and mindfulness app Calm, but remains the former startup’s chairman. Calm was valued at more than a billion dollars in its last funding round.

Mind Candy rocketed to success after Acton Smith created the Moshi Monsters brand in 2007, becoming one of the most prominent startups on the U.K. technology scene. Revenue began to tumble after 2012 and in 2016 it came dangerously close to collapse. Chambers joined that year to reverse the decline and helped to launch Petlandia.

He now sees an opportunity to replicate Mind Candy’s success of a decade ago.

“When I joined, the runway was short,” Chambers said. “Moshi had huge success but struggled to find its way to a new generation of kids, but that doesn’t mean the IP has to die.”

Mind Candy’s $12 million fundraising round was led by existing investor Accel Partners, with participation from Latitude Ventures and Triplepoint Capital.

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