- Snapchat has raised $486 million from several investors in recent months, according to a filing with the Securities and Exchange Committee.
- The company is now valued at $10 billion — and maybe even more — according to media reports.
- There were 23 investors who contributed to the $486 million investment, and TechCrunch reports that Snapchat raised the funds on a rolling basis.
Snapchat lets users send pictures that disappear after a few seconds
Snapchat is one of several mobile messaging apps that have flourished in recent years. Snapchat's distinctive feature is that messages disappear a few seconds after they're opened. This ephemeral quality encourages people to send pictures on a whim. It's also made the app a popular way to send sexually explicit messages.
Last year, Snapchat faced federal scrutiny over charges that its messages were not as fleeting as the company had claimed. And the company has been plagued with other privacy problems as well. A year ago, hackers obtained the usernames and phone numbers of 4.6 million Snapchat users.
The new funding vindicates Snapchat's decision to reject a $3 billion offer from Facebook
The new round of fundraising vindicates Snapchat CEO Evan Spiegel's decision, in late 2013, to reject a $3 billion acquisition offer from Facebook. It was considered a risky move by Spiegel, whose company was just two years old at the time and had no revenue.
The $10 billion valuation also suggests that Facebook's Mark Zuckerberg got a tremendous bargain when he purchased Instagram for $1 billion almost three years ago. Instagram has continued to grow and would likely be worth a lot more than $1 billion today. Last year, Zuckerberg paid $19 billion for the messaging app Whatsapp.