SnapChat Goes Public
In February 2017 the wildly popular smartphone app, Snapchat went public. Well, it’s investing went public. Officially Snapchat is now publicly owned by the stock markets and investors of the world.
For reference, Snapchat is an app available on the IOS and Android operating systems which provides a unique user experience. Sharing photos, videos and now even text and handwritten messages which only last between 1 and 10 seconds between users and have a 24 hour life-time when shared as a story.
According to techcrunch.com upon the public launch Snap, the parent company of Snapchat “priced their IPO at $17 per share, raising $3.4 billion and valuing the company at $24 billion. Like venture rounds, IPOs are fundraising events, yet instead of private investors buying the shares, it’s stock market investors.”
This sets the estimated value of the social app at $24 billion. $24 BILLION dollars, for an app that has grown aggressively since it’s initial launch in September 2011. Rising from 0 – 158 million active daily users in just over 5 years – it isn’t a shock that this company is doing well.
For the past 6 years, they completely ran on their own financial terms even turning down a $3 billion dollar deal from Facebook exec Mark Zuckerburg in 2013. After going public and receiving an estimated value 8 times higher than the offer from Facebook, interestingly enough Facebook has just released their competitive version of the app “Messenger Day”. So far reviews are siding with Snapchat and calling Facebook’s Messenger Day a clone of Snapchat … this really goes to show the power the app holds.
After it’s initial launch, Snapchat received its greatest surge amongst teenager and young adults using its content expiry feature to send out content which they only wanted to share for a short amount of time. Yes, Snapchat did get very popular for its ability to share timed photos and text in the popular forms of sexting… However, fast forward to present day nearly 40% of North Americans are updating their ‘Snap Stories’, sharing Snaps with friends and keeping updated with their favourite celebrities on a daily basis.
So why would such a hugely influential company go public? The general consensus seems to be money. Growing a company of Snapchat’s capacity can be an enormous feat and requires more than the $400 million dollars Snapchat made last year. “They can use that money to do things like acquisitions, international expansion and new product growth, things that Snap would love to do” … says Recode.net.
What do you think of the public having their hands on Snapchat? Have you invested yet? Will you?