Snapchat Inc. Co-founders Evan Spiegal and Bobby Murphy

Snapchat Inc. Co-founders Evan Spiegal and Bobby Murphy reportedly rejected a $3 billion takeover from Facebook, Inc. as well as offers from China’s Alibaba Group and Tencent Holdings Ltd. in recent years. It is now believed that Yahoo Inc. will invest millions in the mobile messaging service. The Wall Street Journal has reported that Yahoo could invest as much as $20 million. This investment could push up Snapchat’s value to approximately $10 billion.

Both Snapchat and Yahoo have declined to comment.

Snapchat is a mobile app that allows you to send disappearing photos and videos. The initial release of Snapchat was September 2011 and in just three years it has grown considerably. They currently have 100 million active monthly users (as at 26 August 2014) with 700 million snaps being sent each day (as at May 2014).

Yahoo recently cashed in on its stake in e-commerce giant Alibaba, when they sold part of their 40 percent stake during the initial public offering that took place last month. Yahoo earned more than $9 billion before taxes.

Since joining in July 2012, Yahoo CEO Marissa Mayer has overseen more than two dozen deals including the purchase of mobile-chat application MessageMe and Tumblr for approximately $1 billion.

Facebook is now looking to create a similar feature to Snapchat, which will allow the automatic deletion of a post ranging from one hour to seven days. Will they be able to compete with the popularity of Snapchat?

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