Ephemeral messaging app Snapchat reached 100 million monthly active users, as its maker secured a new round of funding that values the company at $10 billion, according to The Wall Street Journal.
Sources said venture capital firm Kleiner Perkins Caufield & Byers agreed to invest $20 million in May, giving it a stake of less than 1 per cent. At least one other strategic investor is believed to have committed to the investment round, which is yet to close.
The news comes shortly after Snapchat was reported to be in talks with Chinese e-commerce giant Alibaba about a similar level of investment. These talks are believed to have ended, however.
DST Global, a Russian investment firm, invested in Snapchat earlier this year, giving it a valuation of $7 billion, according to the sources.
The company’s app, which deletes images once they have been viewed, has spawned a number of similar services and prompted Facebook to make a failed $3 billion acquisition bid for the company late last year.
Although it is yet to generate revenue, Snapchat is proving attractive to investors due to its popularity with young users, of which two-thirds log into the service every day, according to a WSJ source.
In addition, Snapchat claims that more than 700 million pictures are sent via its service and more than 500 million stories viewed every day.
Along with the recent addition of text, there are signs that Snapchat is looking to monetise its service, with The Wall Street Journal reporting that it is to gain new functionality, including support for advertising.
The company is believed to have held discussions with advertisers and media companies about developing a new service called Snapchat Discovery, which will also allow users to read daily editions of publications and watch video clips within the app.