Snapchat App Declined $3 Billion Offer From Facebook to Buy Company

Facebook tried to acquire Snapchat to the tune of $3 billion dollars this week, but 23-year-old Evan Spiegel turned down the offer. Several investors, one of which is the famed Tencent Holdings, a Chinese company that valued the start up at around $4 billion, are currently courting the Los Angeles based company.

Forrester analyst Julie Ask commented on the fact that Facebook is looking to strengthen its teen market. She said, "If Facebook is saying they are having an issue with teens and they need to find an app for teen advertisers, then it's logical to find an app where teens are spending their time."

One example of this strategy was the purchase of the popular photo sharing app Instagram last year for $1 billion.

Snapchat has raised about $73 million from investors over the past two years, but the commercial value of the company is still untapped due to its lack of actual revenue.