Alibaba Group Holding Ltd Invests $200 Million In Snapchat

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Alibaba Group Holding Ltd Invests $200 Million In Snapchat

Chinese e-commerce giant Alibaba is investing $200 million in messaging service Snapchat in a deal that values the U.S. start-up at $15 billion. Snapchat, which is banned in China, lets users send text and photo messages that disappear in seconds after the recipient has viewed them. Sources familiar with the transaction told Serena Saitto of Bloomberg that the investment was part of Alibaba’s plans to access overseas markets.

$15 billion for a company that generates little revenue

The valuation marks a massive increase from Snapchat’s previous funding rounds. Last year, the messaging start-up raised funds at a valuation of $10 billion. In late 2013, Facebook had reportedly offered to buy Snapchat for $3 billion. The Los Angeles-based company boasts of more than 100 million users that send more than 700 million disappearing messages daily.

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