When Snapchat spurned takeover interest from the likes of Facebook and Google, investors scoffed at the audacity of the photo messaging service. But the start-up may have the last laugh.
Snapchat has held talks to sell a stake to the Alibaba Group, the Chinese Internet giant, people briefed on the matter said on Wednesday.
The negotiations may not lead to a deal, these people said.
Evan Spiegel, Snapchat’s founder and chief executive, and Jim Wilkinson, a spokesman for Alibaba, declined to comment on the talks, which were first reported by Bloomberg News. The report put the potential valuation of the financing round at $10 billion.
If a deal was reached, it would represent a big bet on the future of Snapchat, the pioneer of disappearing messaging applications. Self-destructing photos and messages have swept across Silicon Valley, catching the attention of tech stalwarts like Facebook, Google and Yahoo.
But it is Snapchat’s captive audience that is the most enticing part to these Internet giants — the company’s core user demographic is age 13 to 25, with 70 percent of that group being women, Mr. Spiegel has said.
Facebook, in particular, has tried — and failed — to mimic the popularity of Snapchat’s ephemeral photo sharing service. The company introduced a similar mobile app, Poke, which failed to catch on with the mainstream. Earlier this week, Instagram, which is owned by Facebook, rolled out its own separate photo-messaging app in a handful of countries.
Thus far, Snapchat seems to be the leader in the space. The company does not share its user numbers, but the application has been among the top 25 most downloaded apps in the Apple App Store in the United States for the past year, according to App Annie, a mobile analytics company.
As of last November, Snapchat users sent one another more than 700 million “snaps,” or disappearing photo and video messages, on a daily basis, according to the company.
What the company doesn’t have yet are robust revenues. It has focused instead on attracting more users to its service.
That may be fine for Alibaba, which has increasingly stepped up its venture capital investments as it prepares for one of the most anticipated initial public offerings in recent memory. The Chinese Internet giant is expected to make its market debut — which could value the company at more than $200 billion — in September, people briefed on those plans have said.
Even before the stock sale, Alibaba has taken stakes in a number of start-ups, as it seeks to make inroads into mobile apps, an area where it has been been trying to catch up. Over the past year or so, Alibaba has taken stakes in Sina Corporation’s Weibo, a popular Chinese equivalent to Twitter, as well as the messaging app Tango.
Behind the drive, in part, is the e-commerce colossus’ ongoing competition with rivals like Tencent, a fellow Chinese giant whose WeChat messaging service has steadily grown in popularity.
Alibaba has also been making a steady push into the United States through investments in tech start-ups like Tango and the car ride service Lyft. Led by Michael Zeisser, a former executive at Liberty Media, the company’s American investment arm has become one of the most sought-after sources of venture capital financing.
One reason is that Mr. Zeisser and his team have expressed less alarm about investing at high valuations, telling entrepreneurs that their deals are made with an eye on long-term horizons.