A new Business Insider report claims that Google was interested in buying Snapchat’s parent company Snap Inc. for at least $30 billion before its IPO in early 2016. The offer from Google was an “open secret” among Snap’s high-level officials and executives.
When Snap went in for its IPO, it was valued at almost $30 billion in May 2016. However, since then, after Facebook copied its Stories feature in Instagram and Facebook, the company has seen its stock prices fall and valuation dip to $15 billion.
After the talks between the two companies did not go anywhere, CapitalG, Google’s growth-stage investment fund, went ahead and invested in Snap Inc. in 2016. Google and Snap have a very strong relationship, with Google’s chairman Eric Schmidt being an adviser to Snap’s CEO Spiegel. For Snap’s part, the company has promised to spend $2 billion on Google’s Cloud hosting over the next five years.
It is unclear how acquiring Snap would have benefited Google or how it would have integrated the company into its own social platform. Google has tried its hands on creating a social platform numerous times over the last few years but has failed consistently.
Snap had previously rejected a $3 billion takeover offer from Facebook in late 2013. Looking back, Google acquiring Snap would have been a good move as it would have allowed the latter to attract more advertisers. Ever since Facebook launched Instagram Stories, there has been an exodus of advertisers from Snapchat, with consumer interest also waning in the app. Nonetheless, knowing Spiegel — Snap Inc’s CEO, it is always possible that the company is working on a killer feature or product that would once again bring it back in the game.
[Via Business Insider]