Chinese version of Snapchat, Kuaishou announced on Thursday that it has raised US$350 million in a funding round from Tencent Holdings, according to a Bloomberg report.
Though both companies' spokespersons have not commented on the matter, an anonymous source revealed that the investment has pumped the startup's valuation to "about US$3 billion."
Having been a popular streaming app among rural communities in China similar to Snapchat's popularity over the world, Kuaishou stated its plans to expand abroad, particularly to developing countries such as Indonesia and Thailand.
Tencent Chairman Ma Huateng referred the platform as a "dynamic Chinese mobile internet product that resonates with people" in a press statement. Kuaishou is believed to have 50 million daily active users with five million videos being uploaded each day. It has been registering a sharp increase of traffic consumption, reportedly overtaking the numbers of Weibo and WeChat.
The company is supported by investments from Sequoia Capital, DST, Baidu, and DCM. According to a TechCrunch report, Kuaishou is planning for IPO in the US in the second quarter this year.
At the same time, it is noted that Chinese tech giants Alibaba and Tencent have been investing heavily in video content and services with the hope to monetize this platform via online advertising.
Alibaba has been putting its focus on China's own Youtube, Youku Tudou, while Tencent has been in talks with game streaming platform Douyu.
In its latest financial report, Tencent reported a net profit of RMB41.45 billion (US$6 billion) for 2016 (up 42% from the previous year), on revenue of RMB151.94 billion (US$22 billion), a 48% increase.
The revenue growth is contributed by the stunning performance of smartphone games, paid digital content, social and performance advertising, and payment-related services. To recap, Snapchat raised US$3.4 bil in its IPO earlier this March.