Yahoo's Marissa Mayer 'nears $20m' investment in Snapchat

Yahoo has 'committed close to $20 million' at a $10 billion valuation

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The Independent Online

Yahoo's Marissa Mayer has a lot of cash to play with following Alibaba's monster IPO last month. And it seems Snapchat is next on her list.

Yahoo has committed close to $20 million, valuing Snapchat at $10 billion, according to sources speaking to the Wall Street Journal. Yahoo and Snapchat have so far refused to comment.

Insiders argue the company is trying to replicate its success story in Alibaba by securing a piece of Snapchat at an early stage.

Yahoo paid $1 billion for a 40 per cent stake in the Chinese e-commerce company in 2005, and the investment has paid off massively. Yahoo made $9.4 billion from selling 140 million shares in Alibaba's record IPO.

The latest speculation follows reports suggesting renowned venture capital firm Kleiner Perkins Caufield & Byers has also agreed to invest $20 million in the company. Alibaba was also reportedly in talks to invest in Snapchat but ultimately opted out.

 

Snapchat initially made headlines after co-founder Evan Spiegel rejected a $3 billion takeover offer from Facebook last year The start-up has 100 million monthly users and is the third most popular mobile app among millennials after Facebook and Instagram, according to ComScore.

However, Snapchat has come under intense criticism with some arguing that it is used for sexting among teenagers and their privacy could be severely compromised. The company has denied it markets itself as a "sexting" app and conceded it is not the safest way to share photographs.

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Spiegel himself has been subject to controversy after a series of university e-mails with references to drugs, drunk sex and misogynistic behaviour leaked online. He later apologised for his comments, claiming they do not reflect his views about women.

Last month, two sisters who modelled for an early version of Snapchat took legal action against the company, arguing it has damaged their reputation and both Spiegel and co-founder deliberately misled them Robert Murphy into taking part in the photo-shoot, describing Snapchat as a "school profit".

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