Snapchat funding rumors return. Could its valuation hit $10 billion?
Snapchat’s millions of users and the intriguing possibilities that the mobile messaging app offers advertisers have made the Los Angeles start-up an object of desire among investors.
The latest rumors of who’s courting Snapchat emerged Tuesday with reports saying that Kleiner Perkins Caufield & Byers, the Silicon Valley venture capital firm that’s made bets in companies such as Facebook and Twitter, had agreed to take a stake in Snapchat. Investments in Los Angeles by the giants of Silicon Valley are rare, but Kleiner has been involved in local efforts such as backing a USC effort to incubate student-founded start-ups.
Kleiner Perkins did not respond to a request for comment, and Snapchat has declined to comment on its fundraising.
New investments in Snapchat could push the start-up’s worth to close to $10 billion, a milestone that only a few technology businesses have recently reached at such an early stage.
A new round of money also could make Snapchat the Los Angeles region’s most well-funded start-up, pushing it past the $191 million invested in NantHealth and the $215 million backing JustFab, according to CB Insights. The research firm says Snapchat has raised nearly $129 million to date.
To those that it’s in discussions with, Snapchat has touted that 100 million people each month are sending or receiving “Snaps” -- short picture or video messages that can be gussied up with filters, sketches and text. The messages disappear forever after a few seconds. The Snaps are the main part of an app that’s been seeing more features slowly added.
Snapchat’s user base has more than doubled during the last year to 23.9 million in the U.S., according to tracking firm Comscore. The figure doesn’t include teenagers, who are among the app’s heaviest users. Facebook Messenger, by comparison, has 42 million U.S. adult users.
Snapchat might toy with more tools for advertisers and content companies in the coming months, but investors in the company recently said the focus remains on adding users. With a larger number of users, the company would eventually become irresistible to brands, they hope.
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