You're right and this is the actual measured risk taken by VC in this case. It's a straight forward bet: if the horse they are better on (snapchat) is given enough of an opportunity (money) to implement far better than any potential competitor without that opporunity, then Snapchat can become a Facebook.

The key differentiator between Snapchat and other competitors is that Snapchat has millions of dollars to throw at problems which, if implemented well, will give them considerable product differentiation through access to the best talent and marketing.

It's a high risk gamble - welcome to VC capital - but it's the business VC is in.