Snapchat, the popular conversation app, ended 2014 with the announcement that it raised nearly half a billion dollars of funding, taking the overall value of the company to nearly $10 billion.
A document submitted to the Securities and Exchange Commission in the final hours of 2014, confirmed that Snapchat has raised more than $485 million since April 2014 from 23 investors.
What is Snapchat?
The identity of the investors remains a mystery, although Yahoo and some of the worlds largest venture capitalist firms are all said to have invested in Snapchat. In fact, the company is notoriously secretive with regards to its investors and operations.
Speaking after emails leaked in the recent hacking of Sony revealed Snapchat had bought a company which makes a device similar to Google Glass, as well as a QR scanning company called Scan.me, chief executive Evan Spiegal said: “We keep secrets because we get to do our work free from judgment – until we’re ready to share it. We keep secrets because keeping secrets gives you space to change your mind until you’re really sure you’re right.”
The leaked emails also revealed that Snapchat had been the subject of a potential $3bn takeover by Facebook in 2013 and that Evan Spiegal had planned to start his own record label, using Snapchat to promote the artists.
Despite only being three years old, the $10 billion valuation of Snapchat means the Los Angeles based company joins an exclusive group of other tech start ups valued well into the multi billions of dollars.
In November, Snapchat was declared the fastest growing app of 2014, with more than a 50% increase in users, taking its monthly active users to more than 200 million.
If you’re not familiar with Snapchat, the app is incredibly popular amongst teenagers and young adults, particular in the USA, UK, Australia and Canada where it is thought as many as 40% of teenagers use the app regularly.
Part of the reason behind the big increase in funding with Snapchat, and no doubt other instant messaging apps in the future, is that these apps are likely to become a springboard in which companies can offer the huge amounts of active users other paid for services. Only last month Snapchat launched Snapcash which enables the transfer of money from one Snapchat user to another.
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