Snapchat was close to acquiring failed anonymous messaging app Secret, TechCrunch reported earlier this week, citing people familiar with the matter. Snapchat co-founder and Chief Executive Officer Evan Spiegel is said to have been primarily interested in hiring the team behind the app, though the ephemeral social platform also ended up adopting one of Secret's design cues, a transitional animation that would open a new interface by expanding a circle icon users tap on before the layer engulfs the entire smartphone screen and turns into a new interface. The animation was introduced in early 2015 as part of Snapchat's initial version of the Discover platform, less than four months before Secret ended up shutting down.
Snap was reportedly looking to hire Secret co-founders David Byttow and Chrys Bader-Wechseler, as well as the entire product team behind the app which it planned to turn into a "special ops" unit, according to one source. While the co-founders are said to have been willing to talk about a sale, having already held preliminary discussions on the matter with both Google and Facebook, not all of Secret's engineers were willing to relocate to Venice, Los Angeles, where Snapchat's headquarters are located, according to the report. The first and only term sheet Snapchat presented to Secret offered between $50 and $60 million, half of the startup's valuation. Most investors pushed against the move because the bid wouldn't account for all of the resources they already pumped into Secret but Mr. Spiegel was reportedly unwilling to bid more, which ultimately led to the talks breaking down, as Billy Gallagher previously claimed in his book "How to Turn Down a Billion Dollars" which retells the history of Snap(chat) leading up to its initial public offering in early 2017.
Secret ended up shutting down not long after a redesign that revamped it into a clone of Yik Yak, with Mr. Byttow claiming the malicious rumors some users were spreading through the service weren't what the creators of the gossip app originally envisioned. Snap posted its best quarter to date earlier this week, though it's still bleeding money, having lost $350 million in the last three months of 2017 alone. The company's recent M&A activity has largely been focused on hardware startups, as well as those developing augmented reality technologies.