Snapchat raises $175 million from Fidelity in latest funding round - source

By Heather Somerville REUTERS - Snapchat has raised $175 million in fresh funding from Fidelity Investments and other investors, according to a source familiar with the matter. The investment is an extension of Snapchat's Series F financing round, which the company began raising last year, the person told Reuters. Snapchat, which makes a free app for sending messages and videos that disappear in seconds, raised the financing at the same $16 billion valuation it had a year ago, The Wall Street Journal reported, citing people familiar with the matter. Fidelity bought shares of the company at $30.72 per share in February, the same price at which it bought Snapchat shares in March 2015, the newspaper reported. (http://on.wsj.com/1WYbSOC) The "flat round," in which a company's valuation does not grow despite an influx of new money, suggests Snapchat's valuation may have grown too quickly and investors are now readjusting their expectations. Still, at $16 billion, Snapchat is the sixth mostly highly valued venture-backed company in the world, tied with Chinese ride-hailing company Didi Kuaidi. Fidelity's investment comes despite the mutual fund's own wavering about Snapchat's valuation. Fidelity slashed its stake in the company by 25 percent during the third quarter last year. But last fall Fidelity marked its stake back up by about 15 percent. The app provider has worked to expand its fledgling advertising business - its only real form of revenue - and last month formed a partnership with Viacom, which gave Viacom exclusive rights to sell advertising around Snapchat's content. (Additional reporting by Parikshit Mishra in Bengaluru; Editing by Andrew Hay and Leslie Adler)