Snapchat, a rapidly growing messaging service, recently spurned an all-cash acquisition offer from Facebook for close to $3 billion or more, according to people briefed on the matter. Chinese e-commerce giant Tencent HoldingsTCEHY had offered to lead an investment that would value two-year-old Snapchat at $4 billion. Snapchat specializes in ephemeral mobile messages, including text or photographs, that disappear after a few seconds. The service has not generated any revenue, but is especially popular among teenagers and young adults, who use the app to send messages to friends. Facebook had earlier offered to buy Snapchat for more than $1 billion, the people briefed on the matter said.
In my opinion, Snapchat made a good decision which is rejected Facebook’s offer because this company will worth more than $3 billion dollars. I think more companies will suggest higher price in the future and if they get more advertisement it will earn more $3 billion dollars because the idea of Snapchat is very unique and something that people never thought about before. I think they need to expand their business to all the ages because teenages are too limited to become a bigger company so they should seek for more people like people in 30’s and 40’s.
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