Fri, Mar 13, 2015 - Page 15 News List

Alibaba eyes US$200m investment in Snapchat

Bloomberg

Alibaba Group Holding Ltd (阿里巴巴) plans to invest in Snapchat Inc, the mobile application for sending disappearing photographs, at a valuation of US$15 billion, people familiar with the situation said.

China’s biggest e-commerce company intends to invest US$200 million, said the people, who asked not to be identified because the discussions are private.

Snapchat is part of a breed of startups with multibillion-dollar valuations, with investors lining up to offer financing.

With the latest deal, Snapchat would be ranked behind only mobile car-booking application Uber Technologies Inc and Chinese smartphone maker Xiaomi Corp (小米), according to data compiled by researcher CB Insights.

Xiaomi is pegged at US$45 billion, while Uber’s latest round valued it at US$40 billion.

“We continue to hire across the business,” chief executive officer Evan Spiegel said at the Montgomery Summit in Santa Monica, California.

He declined to comment on fundraising efforts, adding: “We are famous for not talking about the future.”

Snapchat, based in Los Angeles, was in discussions last month to raise US$500 million in a round of financing that could value the company at US$16 billion to US$19 billion, a person familiar with the situation said at the time.

Alibaba’s planned investment would be outside of that round, one of the people said on Wednesday.

Alibaba declined to comment on the funding.

Alibaba was also involved in discussions last year to invest in Snapchat ahead of the marketplace’s initial public offering in September last year, although a deal did not happen.

Alibaba is expanding beyond its core business of e-commerce, adding other investments such as finance and entertainment content as part of a plan to serve 2 billion customers globally.

Snapchat lets people take and draw on photos, then send them to select friends or add them to a public “story.” The photos and videos disappear seconds after the recipient views them.

The company says its users — the app is popular among teens — send more than 700 million disappearing “snaps” and view more than 500 million stories daily.

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