Snapchat - two years old, no income - turns down $3bn cash offer from Facebook
Snapchat, a two-year-old picture messaging company with no revenue, has rejected a $3bn (£1.8bn) buyout bid from Facebook.
Snapchat company HQ in Los Angeles
The 23-year-old boss Evan Spiegel has turned down the all-cash offer from the social network, claimed the Wall Street Journal, citing people briefed on the matter.
Snapchat is also being wooed by others, including Chinese Internet giant Tencent Holdings which had offered to lead an investment that would value Snapchat at $4bn.
Spiegel's company has no sales and no business model — but it does have a smartphone app that delivers hundreds of millions of picture messages, mostly from teenagers and young adults. Its hook is that these photos then vanish in 10 seconds or less.
It is unlikely that Spiegel will consider an acquisition or an investment at least until early next year, people briefed on the matter said.
A Snapchat spokeswoman declined to comment.
Spiegel, a Stanford University dropout, is thought to be holding out because he hopes his company can get an even higher valuation. In September, the company said its usage had nearly doubled, to 350m messages, or 'snaps' per day, up from 200m in June.
At close to $3bn, Snapchat would be Facebook's largest acquisition to date.
Facebook is reportedly interested in Snapchat because more of its users are tapping the service via smartphones, where messaging is a core function.