Sunnyvale, California–A Yahoo Snapchat deal is reportedly set at $20 million, a small portion of the money it made from its deal with Alibaba. Once again, the tech company is poised to grab a start-up that’s very popular. With over 100 million current users, the Los Angeles-based company is a hit with young users, particularly millennials.
Should the deal pan-out, experts speculate that Yahoo would be in a position to repeat its good fortune that came from its $1 billion dollar investment for 40 percent of the China-based e-commerce site. The acquisition would give the tech company an in with young consumers through mobile technology, which would improve its fight to keep-up with rivals Google and Facebook.
Snapchat is a mobile app which allows its users to send photo and video messages that auto-delete upon viewing. In its latest funding stake, Snapchat was valued to be worth $10 billion.
Yahoo Snapchat Deal Strategic
The move would put Yahoo in a better position to compete with its closest competitors. Under the leadership of Marissa Mayer, who came to be the company’s CEO in July 2012, more than two dozen deals have gone through. In the beginning of this year, the company acquired Flurry for more than $300 million. That was a third of what the tech company spent in 2013, when it bought the blogging service Tumblr for $1 billion.
Yahoo is one of the more popular destinations for millennial users, and its various properties have outperformed Google sites twice over the past several months. However, the world’s largest search engine isn’t setting idly-by, recently, it acquired 55 Yahoo patent filings.
The search market share for Yahoo improved modestly in August, and, it took the initiative to revamp its stores in the same month. Back in July of this year, the company announced it would shutter several platforms because of adverse algorithmic actions initiated by Panda.