Alibaba said to be mulling a stake in Snapchat, at $10 billion valuation

This week’s bubble-icious rumor:  Alibaba, the Chinese Internet giant, is reportedly talking with Snapchat about making an investment that would value the Southern California mobile messaging start-up at $10 billion.

Remember when we were all amazed at reports last year that Snapchat co-founder Evan Spiegel had turned down a Facebook offer to buy the company – for a then-whopping $3 billion?

Snapchat didn’t even make money back then. Oh wait, it still doesn’t.  But online companies know that the idea of sending messages that disappear after a few seconds is highly appealing to some Internet users, particularly teens.

And absence of revenue didn’t stop Facebook from buying WhatsApp earlier this year for $19 billion in cash and stock. WhatsApp has 500 million users; SnapChat doesn’t disclose user numbers.

Neither Alibaba nor SnapChat have confirmed the talks, but Bloomberg News reports that unnamed sources say they’re ongoing.

Brandon Bailey Brandon Bailey (350 Posts)

Brandon Bailey covers Google, Facebook and Yahoo for the San Jose Mercury News, reporting on the business and culture of the Internet.