Snapchat files confidentially for IPO, sources say

Messaging app Snapchat has filedconfidentially with the Securities and Exchange Commission (SEC)for an initial public offering (IPO), sources familiar with thesituation said on Tuesday.

The filing puts the Venice, California-based company onestep further towards its IPO, which sources say could come assoon as March and value it at $20 billion to $25 billion, making it one of the biggest technology offerings in recent years.

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Under the U.S. Jumpstart Our Business Startups Act,companies with less than $1 billion in revenue can secretly file for an IPO, allowing them to quietly test investor appetitewhile keeping financials confidential.

The sources asked not to be named because the information isprivate. A spokesman for Snap Inc., Snapchat's parent company,declined to comment.

Snapchat started in 2012 as a free mobile app that allowsusers to send photos that vanish within seconds. It has morethan 100 million active users, about 60 percent of whom are aged13 to 24, making it an attractive way for advertisers to reachmillennials.

Awash in venture funding, the company raised $1.81 billionin May, which valued it at about $20 billion, media reports saidat the time.

But investors worry that Snapchat's advertising sales, whichbegan last October, is the company's only significant revenuesource.

In September Snap starting describing itself as a cameracompany and earlier this month it debuted its $130 video-camerasunglasses. The glasses are equipped with a camera that connectswirelessly to a smartphone to take and send "snaps" thecompany's terms for video and photo messages sent on its app.

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According to postings on Twitter, a line of more than 100people quickly formed in front of a vending machine on a Venice,California, boardwalk where the glasses were being sold.

The company's investors include General Atlantic, SequoiaCapital, T. Rowe Price and Lone Pine. Previous rounds includedFidelity Investment, Kleiner Perkins Caufield & Byers and YahooInc.

Earlier this month, Alphabet Inc's venture capitalarm CapitalG, earlier known as Google Capital, disclosed an investment in Snapchat by adding the social networking firm'slogo to a page on its investment portfolio website.