CapitalG now an investor in Snapchat
CapitalG has not made any formal announcement, it was not clear when Google made the investment as no details were provided about the timing, reasoning or size of the Snapchat investment.
The venture capital arm CapitalG of Alphabet Inc has disclosed an investment in Snapchat by adding the social networking firm’s logo to a page on its investment portfolio website.
CapitalG quietly added Snap Inc to its list of investments as part of a brand refresh and website redesign on Friday. It added Snapchat logo to its portfolio of investments.
Reportedly, even though CapitalG has not made any formal announcement, it was not clear when Google made the investment as no details were provided about the timing, reasoning or size of the Snapchat investment. The company had not been available to comment, Reuters said.
It had been reported earlier that Snap Inc, which operates the popular messaging app Snapchat, has hired Morgan Stanley and Goldman Sachs Group Inc as lead underwriters for an initial public offering. The leading banks were notified last month that they had been awarded one of most coveted and potentially lucrative IPO mandates in recent years, as the Venice, California-based company vies. According to the reports, both the companies have had a cozy relationship.
In 2013, it was rumored that Google once tried to buy Snapchat for $4 billion after it turned down a Facebook acquisition. To this day, Snapchat remains one of the largest users of Google's cloud infrastructure, although it's recently brought a data center specialist in house.
In a report of CNN Money, it quoted confirmation via Winnie King, a spokeswoman for Google, who confirmed that Snapchat is one of Google Capital's portfolio companies, but declined to comment beyond that. Noah Edwardsen, spokesman for Snapchat, said the company does not comment on financing.
CapitalG was formed in 2014 to invest in more mature businesses. The goal, according to its website, is "to make returns-driven investments in leading companies around the world."
Reportedly, this investment operation has also backed Airbnb, Glassdoor and SurveyMonkey. GV, Alphabet's other venture capital arm for early-stage companies, has invested in Uber and Nest, the latter of which Google ended up acquiring for $3.2 billion in 2014.
Snapchat, lets its users send smartphone photos which automatically disappear after a few seconds, has proven popular among teenage users. Therefore, an investment in Snapchat opens the door for a closer relationship with a buzzy startup that is expanding into several areas of interest for Alphabet.
It is well understood that Snapchat is a rising star in social media, long a weak spot for Google. According to a report, it also recently expanded into hardware with Spectacles, a pair of sunglasses with a built-in wireless video camera. The product quickly drew comparisons to Google Glass, its failed attempt at smart glasses.
It has been reported that the investment gets Alphabet a ticket to what is expected to be one of the hottest upcoming tech IPOs since Facebook.
Reportedly, other prominent Snapchat backers include Alibaba , Yahoo and Fidelity.