• by Gavin O'Malley  @mp_gavin, November 26, 2008

Showing technology's ability to attract venture capital even in a bum economy, white-label widget maker KickApps has closed a Series C funding round worth $14 million.

The round was led by North Atlantic Capital, with participation from existing investors Softbank, Spark Capital, Prism Ventures and Jarl Mohn, former CEO of Liberty Digital, Inc.

The funds will be used to accelerate KickApps' expansion into new markets and continued product innovation, according to Alex Blum, CEO of KickApps.

"Our mission is to transform a number of traditional services--video players, editorial presentation, advertising, analytics, marketing, customer relationships--into highly interactive experiences that are contextually informed by live, actionable data," said Blum.

The Web software maker--which makes widgets for companies, which it helps them monetize--had previously raised $17 million in two rounds of venture capital financing, the most recent in August 2007.

For the past year, rumors have circulated that AOL was closely eyeing KickApps for a reported price of $90 million. Neither company, however, has confirmed any discussions.

KickApps clients include ABC Family, CW Television, Scripps Network Interactive, HBO and Cinemax.

Amid market-wide economic uncertainties, venture capital still appears to be available for technology providers. Earlier this month, for example, the white-label video technology company Digitalsmiths has closed a second round of financing worth $12 million.

Clearspring, a widget syndicator and KickApps partner, earlier this year raised $18 million in a third round of funding from New Enterprise Associates, Novak Biddle Venture Partners and other investors.

Over the last two years, widgets have surged in popularity because--unlike pop-ups--their presence is controlled entirely by the users themselves, and they are generally used to complement social networking and blogging experiences.

Indeed, according to comScore, nearly 148 million U.S. consumers, or 81% of Web users, viewed widgets in November of last year. Widget ads, meanwhile, are expected to boost social network advertising by 70% to $1.6 billion in 2008, according to a recent projection by eMarketer.

KickApps is one of more than 40 white-label social service providers--including ONEsite, Userplane, LiveWorld, SixApart, Ning, CrowdVine, Dave Networks, CollectiveX, Me.com, iBelong and Haystack.

Concurrent with this most recent investment, Mark Morrissette, managing director from North Atlantic Capital, has joined KickApps' Board of Directors.