WSJ: Snapchat To Have $10 Bln Valuation On Kleiner Perkins Investment

(RTTNews) - Venture capital firm Kleiner Perkins Caufield & Byers has agreed to invest up to $20 million in ephemeral messaging service Snapchat Inc., the Wall Street Journal reported Tuesday, citing people with knowledge of the matter.

According to the WSJ report, the investment would give Kleiner a stake of less than 1 percent in Snapchat, but would value the Los Angeles-based startup at almost $10 billion.

Snapchat is in the process of raising a large investment round that would make it a valuable private tech starup despite having virtually no revenue. The WSJ reported that at least one strategic investor has also committed to invest in the latest round.

Earlier in August, media reports indicated that Snapchat was in talks with investors, including Alibaba Group Holding Ltd. (1688.HK), for financing that would value the firm at $10 billion.

However, Bloomberg had reported that Snapchat's talks with Alibaba to raise funds were over. Alibaba is said to be prepared to begin talks after it holds an initial public offering.

The new capital will reportedly enable Snapchat to branch out into advertising later in the year.

Snapchat is said to be preparing to sell a stake in itself by issuing new shares. The company has more than 100 million monthly users, compared to WhatsApp's more than 600 million active monthly active users and micro-blogging site Twitter Inc.'s (TWTR) 271 monthly users. WhatsApp was acquired by Facebook Inc. (FB) in February 2014 for about $16 billion in cash and stock.

In mid-June, Facebook said it launched a new photo and video sharing app called Slingshot, which would be immediately available in the U.S. for iPhones and Android phones. The app is Facebook's answer to Snapchat, which reportedly rebuffed Facebook's $3 billion takeover bid last year.

Kleiner has earlier invested in tech companies such as Facebook, Twitter, Google Inc. (GOOG, GOOGL) and Amazon.com Inc. (AMZN). The company was reportedly among several investors who participated in the funding of Uber Technologies Inc. recently.