Path Is Raising $50M At A $500M Valuation, Still Looking For A Lead Investor

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Path is raising a $50 million Series C round at a $500 million post-money valuation. Sources tell us the company is still seeking a lead investor, the round is currently oversubscribed, and one of the investors in the round is “a strategic private investment group in Asia.”

Last April, the social network founded by ex-Facebooker Dave Morin raised $30 million at a $250 million valuation.

We’ve also heard rumors that Path has been in acquisition talks with several industry giants. Google, which offered over $100 million to acquire Path in 2011, was the name that came up the most, but sources have said those rumors are false.

This contradicts an earlier report from us that said the company was raising at a valuation as high as $1 billion. Sources say that Path was never raising at a valuation as high as $1 billion, but is still having some difficulty with this Series C.

On the one hand, it’s hard to read too much into investors passing on Path, as that is commonplace in funding rounds. And yet, the timing of the round can’t be great for Path, as it comes at a difficult time in general to be raising, and right on the heels of controversy over the company’s methods for acquiring users, and amid speculation about the company’s userbase.

Onavo Insights tells us that while millions have downloaded the app, active users are declining, at least in the U.S. In June, 1.9 percent of U.S. iPhone users actively used the app, which is down 24 percent from 2.5 percent of users in May.

Additional reporting by Alexia Tsotsis and Kim-Mai Cutler.