Facebook Inc (FB) Reportedly Made A $3 Billion Offer For Snapchat, But Got Turned Down

Posted Nov 13, 2013

Facebook Inc (NASDAQ:FB) has reportedly made a $3 billion cash offer for Snapchat, but got turned down.  Snapchat is an app that is used for sending messages to friends that self-destructs after a few seconds of being viewed.  This rumor is based on a report by The Wall Street Journal.  Snapchat is now hitting around 350 million messages per day.

This offer is over 3 times the value of Facebook’s successful bid for Instagram.  Founded two years ago, Snapchat may now look at a funding round at a $4 billion valuation.  Snapchat currently does not make any money, nor have they disclosed the exact size of their suer base.  It has been estimated that Snapchat is used by 9% of adult cell phone owners in the U.S., according to Pew.

This is not the first time that Facebook made a bid on Snapchat.  Facebook previously bid over $1 billion in Snapchat, according to the WSJ.  It is likely that Snapchat co-founder and CEO Evan Spiegel will not consider an acquisition or investment until early 2014.

Snapchat is also dealing with a lawsuit from Reggie Brown.  Brown was a classmate of Spiegel’s that claimed that he should be labeled as a co-founder and should have as much ownership in the company as him.

Snapchat has raised around $73 million in funding from Lightspeed Venture Partners, Benchmark Capital, Institutional Venture Partners, SV Angel, and General Catalyst Partners.