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.
Marissa Mayer in pictures
Marissa Mayer in pictures
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Marissa Mayer, chief executive and president of Yahoo!, poses for a Vogue photo shoot
2/7 Marissa Mayer in pictures
Mayer received a score of 8.45 out of 10 in the "Beauty is Wealth: CEO Appearance and Shareholder Value" ranking 677 chief executives from S&P 500 companies based on their facial geometry
3/7 Marissa Mayer in pictures
She's been described as Silicon Valley's "geek goddess" by Vanity Fair magazine
4/7 Marissa Mayer in pictures
Mayer posed for Vogue's magazine September issue in 2013
5/7 Marissa Mayer in pictures
Mayer took over Yahoo in summer 2012
AP; Getty Images
6/7 Marissa Mayer in pictures
On the day Yahoo! announced her hiring, Mayer revealed that she was pregnant with her first child
7/7 Marissa Mayer in pictures
Marissa Mayer spent 13 years at Google
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".