
Snap Jumps in Debut After App Maker Raises $3.4B in IPO - rayuela
https://www.bloomberg.com/news/articles/2017-03-02/snap-opens-at-24-a-share-well-above-the-17-dollar-offer-price
======
chollida1
I'm happy for the NYSE that this went well. SNAP has done some pretty large
volume so far with no problems.

Interestingly enough, well atleast to someone who cares about the cash equity
markets, the NYSE actually did a test run last week to try and simulate the
chaos that occurs during any hot IPO.

So now we know that there is atleast some appetite for shares with no
controlling interest and no indication of paying out a dividend any time soon.
A current market cap of 30 Billion is a pretty darn big accomplishment!

Two big dates in the future to look out for.......

1) July 30 when the first lockup date is over. I'm not sure how many shares
come off restriction.

2) May 15 when they do their first earnings report.

I'm interested to see if they try and make people view the company via GAAP
accounting(PnL) or non GAAP measures like engagement, monthly users, etc.

~~~
pm90
> So now we know that there is atleast some appetite for shares with no
> controlling interest and no indication of paying out a dividend any time
> soon. A current market cap of 30 Billion is a pretty darn big
> accomplishment!

This is really disturbing. I don't know if its an indicator of too much money
in the market, or just the fact that the market itself has expanded so much.
Why would investors be OK with losing power?

~~~
jmharvey
It could be an indicator that a lot of people invest without regard for
foundational questions like "does this valuation make sense" or "does my
ownership interest grant me any control of the company?"

And I'll be the first to raise my hand on that front. On the face of it, I'm
not really interested in owning a stock like this. But I've stopped picking
stocks entirely, now I just invest in the stock market through index funds.
And there are a lot of people like me -- enough that Vanguard funds own about
5% of just about every public company you can name. People like me are
essentially saying, "We don't really care what this company does, how much it
costs, or whether its stock can vote, we want to own 5% of it." (And that's
just Vanguard -- there are plenty of other passive funds out there, too.)

In an IPO that sells 10 or 15% of the company, these "buy at any price"
investors can eat up a pretty big chunk of the available shares. So all it
takes is a few investors to say, "yes, we want to buy at this valuation," and
the rest of us will blindly follow.

~~~
cbhl
Is Snap big enough that indexes tracking the S&P 500 would buy up Snap?

If not, what index funds would?

~~~
nandemo
> Is Snap big enough that indexes tracking the S&P 500 would buy up Snap?

With the risk of stating the obvious... index _funds_ tracking the S&P 500
_index_ buy exactly the 500 stocks that form the index, no more no less
(modulo some derivatives that are highly correlated with the index).

So they will buy Snap whenever S&P decides to include Snap in the S&P 500
index. Snap has already surpassed the minimum necessary market cap (~U$5
billion). There are other criteria, but ultimately the inclusions and
exclusions are decided by committee [0]. When they do decide change the index,
they announce it well ahead of the date when the change is effective.

[0] S&P U.S. Indices Methodology
[http://us.spindices.com/documents/methodologies/methodology-...](http://us.spindices.com/documents/methodologies/methodology-
sp-us-indices.pdf)

------
linuxkerneldev
This $27.8 billion dollar valuation tells me that somewhere along the line, my
job and lifestyle have caused me to detach from a significant chunk of
society. I've never used Snap or their platform. I don't even really know what
the benefit of their service. I am curious if I'm in the minority or if
there's lots of developers like me who aren't able to comprehend these
valuations.

~~~
InternetUser
> my job and lifestyle have caused me to detach from a significant chunk of
> society

Yeah, the 13-21-year-old chunk of society. Do you, as a Linux Kernel
Developer, happen to be within that demographic? Even their IPO roadshow video
(which I see has now been removed) talks about their "13-34-year-old" user
base, and then emphasizes the far higher levels of engagement and far higher
potential among the lower half of that range.

~~~
missing8
Sure the bulk of their users are young, but several of the people I follow are
betweeen 28 and 45.

It's not like Snapchat is an esoteric thing. Using it can be a function of how
outgoing and expressive you are. Or if you have some purpose.

The same reason you post on Hacker News is why people post on Snapchat -- to
interact with others.

~~~
Domenic_S
Posting on HN (or reddit, or...) will never die, because you get to correct
people who are wrong on the internet. Snap not so much...

~~~
mi100hael
I don't think that's quite right. Snapchat does have a chat feature which
allows you to essentially send feedback on peoples snaps/stories, so you could
absolutely tell people they're wrong for making some statement.

~~~
atomical
I think it was a joke.

~~~
freyr
I think it was a joke.

------
doc_holliday
I know that the Snapchat platform is worth something, it has high engagement
and adoption of 18-24 year old age segment, and that is worth a lot in terms
of attention and advertising $s.

However, this just feels completely out of proportion to earnings and downside
does not seem priced in. Willing to be proved wrong of course, but especially
seeing as they are non voting shares, I cannot understand this pricing.

~~~
InternetUser
And that's not their only product:

Bitmoji has been the #1 iPhone app overall since January 11, and it was
already the #1 iPhone Utility app since July 22, 2016 (Log in to see) -

[https://www.appannie.com/apps/ios/app/bitmoji-keyboard-
your-...](https://www.appannie.com/apps/ios/app/bitmoji-keyboard-your-
avatar/rank-
history/#vtype=day&countries=US&start_date=2014-09-09&end_date=2017-03-02&device=iphone&view=rank&lm=7)

[https://www.appannie.com/apps/ios/top/united-
states/overall/...](https://www.appannie.com/apps/ios/top/united-
states/overall/iphone/)

And yesterday on eBay, 22 pairs of Spectacles were sold, with one pair went
for $229 and 2 others went for $200 each, even though
[http://www.spectacles.com](http://www.spectacles.com) has been offering them
for $130 since last Monday -

[http://www.ebay.com/sch/i.html?LH_Complete=1&LH_Sold=1&_from...](http://www.ebay.com/sch/i.html?LH_Complete=1&LH_Sold=1&_from=R40&_sacat=0&_nkw=snapchat+spectacles&_sop=13)

Then there is the rumored Android Snap Phone:

[http://mashable.com/2017/02/14/snapchat-phone-concept-
design...](http://mashable.com/2017/02/14/snapchat-phone-concept-design-
mediakix/#yE1hJFZjZPqp)

And Snap Drones, as reported on page 2 of today's NYTimes -

[https://www.nytimes.com/2017/02/28/technology/snapchat-
drone...](https://www.nytimes.com/2017/02/28/technology/snapchat-drone.html)

[http://i.imgur.com/6Nl0Ymq.jpg](http://i.imgur.com/6Nl0Ymq.jpg)

~~~
vadym909
Trend moving from So(cial)-Lo(cal)-Mo(bile) to AI-AR-Dr(one)-SDR(self driving)

~~~
InternetUser
That is actually quite brilliant. Did you just make that up? I can't find it
in Google.

------
probe
The SNAP thesis I like the best is - "Twitter-like growth with FB ARPU".

The monetization potential of this company is massive (geofilters, sponsored
content, hardware with spectacles, etc.) and there's no direct comp for that.
Pokemon Go showed us the bleeding of digital to physical, and Snap has the
potential to be the first company to unlock value from it (ex. geofilters).
Plus you can view SNAP as a call option on AR and their potential to be the
main camera (when something exciting happens, which app do you open first? For
at least in my social circle its by far Snapchat not the Camera
app/twitter/etc).

That being said, they face a massive threat from Instagram Stories and now
WhatsApp Stories. Though a caveat - while their DAU growth has slowed, it's
actually been in international markets primarily (and I think wrongly they
don't care enough about dealing with low-bandwith, "unexciting" users). If
they can keep a healthy growth in US to escape the FB threat they can afford
to lose internationally.

Their first 1-2 earning report will be very revealing for SNAP b/c the
expectations have been set and I'm looking for them to do the following: 1)
Raise ARPU at similar rates 2) Maintain healthy DAU growth in the US 3) Create
new product innovation around AR/Spectacles/Lenses.

If they don't hit at least one of those goals (and preferably two or all
three), than I would be very concerned for them.

~~~
moolcool
>Pokemon Go showed us the bleeding of digital to physical

It also showed how quickly a popular phenomenon can loose cultural relevance.

>when something exciting happens, which app do you open first? One that
doesn't automatically delete the photo I took of the exciting thing by default

~~~
probe
I'd argue it was poor/slow execution that led Pokemon Go to lose cultural
relevance. If they had introduced more pokemon, ability to trade/battle, etc.
they would still be highly relevant and a behemoth today.

When I post to Stories I also post to "Memories" so everything is saved on the
app. Plus I usually go back to snapchat and save pictures from my story
manually if I want to have it saved locally. Most people I know do the same.

------
zachgersh
My favorite tweet about the whole situation:
[https://twitter.com/objective_neo/status/736530568222015489](https://twitter.com/objective_neo/status/736530568222015489)

~~~
overcast
That was my sentiment five years ago for Instagram.

9 Apr 2012

2008:Sun buys MySQL for $1B. 2012:Facebook buys Instagram for $1B. DB tech
running half the web+revenue vs hipster photo filter app+no rev.

~~~
fullshark
I saw pretty easily how Instagram could be worth a billion to FB, who has a
social network and wants to expand their user base / stop competition from
rising.

I don't understand how these shares that pay no dividend and give no voting
power are worth $24 each. They are basically "SnapChat Fun Bucks." Anyone
buying it just hoping another person down the line will pay more for it. On
top of that, we know there's a large number of people holding it (employees)
that are going to start selling their shares over the next year.

I just don't get how this has any value at all.

~~~
xuki
Short it if you truly believe the stock will go down. Easy money ;).

~~~
fullshark
I'm humble (and risk averse) enough to admit I could be wrong. But it baffles
me.

------
kapkapkap
Can someone comment as to what kind of payday this IPO translates to for say
the 30th engineer hired by Snap? (I realize that this is impossible to answer
accurately, and that there is still a 4 month lockup)

~~~
dvt
Interviewed with Snapchat about 3-4 years ago (sub-100 employees). Did not get
an offer, but their interview process was pretty standard and professional.
They were giving out 0.001% equity at the time. I'd say it would come out to
250k-500k, but it's very hard to extrapolate.

They were already a mega hit with like 10 employees so I doubt anyone that
hasn't been there super early (like first 5 employees) will become a
millionaire off this IPO.

~~~
khazhou
Assuming the founders held 30%, the employee equity was 1/30,000th that of
founders. I don't understand how engineers are ok with their boss getting
30,000X their compensation.

~~~
dvt
First, equity isn't compensation, it's ownership. Second, it's about risk.
Third, it's about luck.

So, if you get paid a market salary and benefits, you can't really expect to
own much of the company that's providing you with that salary and benefits as
it's essentially burning money on you. If you came in and said "can I get 1%
ownership if I take 15k a year with no benefits" that would be a different
story, but that's not how this works.

~~~
was_boring
I don't know about years prior, but Snapchat's executive team is making over a
million a year. Not much risk at this point.

~~~
dvt
My comment was in the context of engineering (as that's what I interviewed
for). Executive-level positions are a lot more nuanced.

~~~
codeisawesome
Could you expand upon the nuances?

------
sgwealti
I'm a light snapchat user (send/receive ~100 snaps/week and post to my story
every 3-4 days) and I have a question about its value as an advertising
platform. I always skip the ads, and I don't know anyone else who uses
snapchat who does't immediately skip the ads. When I do this, is it counted as
an impression? I can't imagine advertisers would be happy to know that the ads
can be skipped. Also I never use the Discover page and I don't know anyone who
does. Yes, I'm one person and this is an anecdote but hopefully advertisers
are getting valid engagement metrics.

~~~
cspags
I've wondered this as well, but my guess is that they'll go the Youtube route
and make the ads less and less skippable over time.

------
mring33621
I think it's generally appropriate to view events like this SNAP IPO as loudly
hyped introductions of new vehicles for financial speculation.

SNAP is a shiny new toy for traders and market-makers.

We won't know how the public market truly values SNAP until, IMHO, maybe 12-24
months from now.

------
kchoudhu
Snap employees got screwed.

[http://www.businessinsider.com/antonio-garcia-martinez-
chaos...](http://www.businessinsider.com/antonio-garcia-martinez-chaos-
monkeys-lessons-from-facebooks-ipo-for-snap-stock-pop-2017-3)

------
unholiness
Economics novice here. How did we get such a huge difference (40%!) between
the IPO price and the current price, when both sides had $3.4 billion at stake
on getting that price "right"? Is there some huge information disparity here?

Moreover, if investors feel that $24 a share is a fair price, why weren't they
swooping in before the IPO and, say, offering $20 a share for the whole chunk?

Sorry if this seems like a ridiculous question, but it seems to me like there
should be some extremely large free market force (on the order of $1.4
billion) preventing the founders and employees from missing out on all that
money. Am I wrong?

~~~
chimeracoder
> Moreover, if investors feel that $24 a share is a fair price, why weren't
> they swooping in before the IPO and, say, offering $20 a share for the whole
> chunk?

Well, they were. When a company IPOs, it doesn't sell its stock directly on
the market - it sells it to intermediary bankers, who buy it at a price that
they think will lock in profit for them when _they_ sell it at the opening
bell. (In addition, the early purchasers are also other bankers and trading
firms - as an individual, there's zero chance that you'll get the IPO price
unless the stock flatlines when it opens).

So, from the company's perspective, the ideal situation is to price that as
high as possible, and actually overshoot the market price - that way, they
leave no money on the table, and they can raise as much as possible for the
number of shares they're selling. In that case, the share price will drop a
few minutes after the opening bell, and it'll close trading that day somewhere
below the opening price.

Note that that's exactly what happened with Facebook ($FB), and the bankers
were pissed off. That's why you saw so many articles about the Facebook IPO
being a "failure" at the time. It wasn't a failure for Facebook - they made a
ton of money! It was a failure for the bankers who wanted to make a profit on
the resale, and instead sold those shares at a loss.

I'm oversimplifying, because there was a lot of other stuff that went into the
Facebook IPO that complicated it[0], but that's the general idea.

[0] a lot of people learned the meaning of the "reverse greenshoe" that day!

~~~
unholiness
Hmm. To me that just shifts the questions to the bankers.

If people (who don't know anything the bankers don't know) value the stock at
$24, shouldn't there also be competing bankers willing to offer $20 a share
for the whole lot, igniting a bidding war that converges roughly near the real
price?

Obviously bankers need to make some money. But I don't see how this kind of
deal has anywhere near a $1.4 billion dollar overhead, and I'm just boggled by
the scale of the disparity.

~~~
chimeracoder
> If people (who don't know anything the bankers don't know) value the stock
> at $24, shouldn't there also be competing bankers willing to offer $20 a
> share for the whole lot, igniting a bidding war that converges roughly near
> the real price?

Yes, though with a discount factor applied due to the risk involved. And
particularly for a high-profile IPO like $SNAP, and one in which a lot of the
sellers on Day 1 will be casual retail investors placing market orders[0],
it's hard to gauge exactly how much hype there will be.

[0] ie, as opposed to limit orders

------
paglia_s
As an user in their target age (18-24) I have to say that since Instagram
started introducing features like stories and stickers the activity in my
Snapchat has diminished enormously. I would say 50-70% less activity.

I don't know if it's something specific to my social circle or more widespread
but anyway it's been impressive

~~~
kilroy123
Plus facebook just rolled out the same feature on WhatsApp. Which has, what, 1
billion active users as well?

Facebook is going full-throttle trying to compete against snap.

~~~
adventured
It's extremely clear that Facebook is setting itself up for an anti-trust
action in the next few years. Their very aggressive leveraging of their near-
monopoly in social to try to kill Snapchat, will be viewed in hindsight
similar to Microsoft attacking Netscape with its OS position. If Facebook
succeeds, it'll leave them with an overwhelming monopoly in social, there's no
scenario under which they won't be pursued by the government thereafter. Plus,
you can bet Snapchat and its investors will begin to howl loudly the harder
Facebook presses.

Zuckerberg's lust for market domination, will unravel or stagnate his kingdom
if he's not very careful. His behavior at this point is looking ever more
Gates-like when it comes to trying to knock-off the competition while
possessing a near-monopoly (you can do one or the other, but if you're a $400b
company and you try to both kill all your competition while having such a
position, good luck).

------
usaphp
Reminds me of Facebook IPO, a lot of people were claiming it will plunge and
eventually go bankrupt. But companies with such big daily active audience that
can be targeted with ads are here to stay.

~~~
jonknee
Considering it went smoothly it doesn't remind me of Facebook's IPO at all.
Twitter should be all the evidence you need of how hard it is to succeed
selling advertising to a big audience. Snap might crush it, but I would give
them a few earnings reports before comparing them to anyone.

~~~
maxerickson
Facebook's market debut showed that Facebook did an excellent job controlling
and pricing the IPO. Banks complaining -> Facebook and insiders won.

This debut just shows that Snapchat wasn't in the driver's seat. Major holders
are still mega wealthy though.

~~~
jonknee
No, it was a disaster that led to years of litigation. NASDAQ admitted it was
their technical error and paid millions to settle lawsuits stemming from it.

This obsession by techies that you're leaving money on the table if your
shares go up after an IPO is bizarre.

~~~
toast0
> This obsession by techies that you're leaving money on the table if your
> shares go up after an IPO is bizarre.

If the company gets $X/share at the beginning of the day, and bankers get $X *
1.5/share at the end of the day, that feels like a big donation to Wall
Street. If I'm an investor, I'd rather the company have all the capital than
2/3rds of the capital as well. It feels like if a company would sell a portion
of the offering through the traditional channels, and the remainder at market
prices throughout the first couple days of trading, it might better capture
investment.

------
bojl
A lot of the comments in this thread are missing the point. No one cares if
you use Snapchat, no one cares if you like Snapchat. The question is how much
market space can Snapchat occupy, and will their bets on new technology (VR,
drones, etc) work out.

------
onion2k
I wonder how much of this is investors with a good understanding of Snap's
potential buying because they feel it's a good gamble versus stock market
investors not having many opportunities to invest in tech startups because
there's so few IPOs.

------
intrasight
I can't help but think the title should be "Nude selfies startup IPO values
firm at $20 billion"

~~~
econner
Turns out people really want nude selfies.

~~~
intrasight
Many thousands of those (so I have heard) can be found on Tumblr. I think it
means "people really want to take secure nude selfies".

------
Symmetry
Ouch, so they collect $1.4 billion less than they could have if they're priced
their stock higher.

------
nkkollaw
Can someone explain to me how Snap can be valued this much?

I feel like I was asleep for 50 years and I just woke up and I have no idea
how society works.

Don't they make a little sexting app? What happened!

~~~
quizbiz
[https://www.sec.gov/Archives/edgar/data/1564408/000119312517...](https://www.sec.gov/Archives/edgar/data/1564408/000119312517029199/d270216ds1.htm)

~~~
nkkollaw
Not very helpful.

This is in their timeline: "Lenses launch on Snapchat. Users barf rainbows for
the first time".

I feel even more confused.

------
kevando
ITT: I don't have a Visa card, how can they be worth $1T?

~~~
kilroy123
Well, VISA only has a $200 billion marketcap.

------
zach417
I don't understand how the existence of Snap adds over $30B of utility to the
economy.

~~~
capkutay
> I don't understand how the existence of [any company ever] adds over [their
> current valuation] of utility to the economy; furthermore, if [company] fell
> of the face of the earth, everyone would just switch to [their competitor],
> and life would resume ut fit. Peter Thiel's quote should be updated: We
> wanted flying cars, instead we got 1̶4̶0̶ ̶c̶h̶a̶r̶a̶c̶t̶e̶r̶s
> [trivialization of product's value].

These comments surface every time a company goes public. You may have some
valuable information driving this viewpoint underneath, but from this comment
it just sounds like useless trolling.

To me at least, Snap seems like a good company with cultish user-base. They
have done a good job integrating ads and rich content (some paid content) into
their core UX. A difficult feat which Twitter still hasn't solved to this day.
They also have an interesting perspective on live events that even
FB/Instagram has failed to replicate.

~~~
zach417
I had removed the last part from the comment as to seem less trollish, so
please forgive me for coming across as such. Anyway, since you asked, here is
my formalized argument: (1) [falsifiable axiom] You cannot have meaningful
economic growth without technological innovation. Technological innovation is
improving the efficiency of existing resources or increasing the availability
of resources as compared to previous eras (colloquially, "doing more with
less"). (2) [falsifiable axiom] Historically, only the most valuable companies
of a given era are technologically innovative. (3) [falsifiable axiom] Under
the current valuation, Snap Inc. is currently one of the most valuable
companies. (4) [falsifiable axiom] Snap Inc. is not technologically
innovative. (5) [logical conclusion given axioms] Snap Inc. should not be
valued as one of the most valuable companies of this era.

~~~
Apocryphon
Kids like it. Shouldn't that count for something? You might as well question
why video games, or professional sports, or Hollywood, or any other form of
commercial entertainment generates so much money.

~~~
zach417
Haha, that's exactly my point! I do question why the entertainment industry
siphons so much capital away from other, more productive endeavors. Perhaps no
one has any good ideas on how to create the future, so we might as well throw
it all at beer and sports.

------
aphextron
This is going to open the floodgates for so many smaller startups that have
been waiting to IPO. 2017 is going to be an exciting year for anyone with
equity.

------
jboggan
Santa Monica and Venice are going to get even more expensive in 6 months.

~~~
fjdlwlv
Snap is now trying to grow out of Venice because they've already
businified/gentrified/grown too much and are getting a lot of local hate

~~~
Apocryphon
Makes me wonder if Spiegel will bite the bullet and open up a SV office, like
Tinder has.

~~~
sushid
Snap already has an SF office.

~~~
Apocryphon
Wait, where?!

------
lobster_johnson
Snap Interactive, which an unrelated company, also saw a bunch of trading due
to the IPO [1]. I'm sure this kind of name confusion happens a lot.

[1] [http://finance.yahoo.com/chart/STVI](http://finance.yahoo.com/chart/STVI)

------
mtgx
Hopefully now they have no excuse not to implement end-to-end encryption in
their app.

------
yalogin
I would only look at this stock after the first year. Having followed some of
the previous high profile IPOs, we will see what happens after their employees
are able to dump stock after the first year.

------
InternetUser
The stock is now showing up online:

[http://finance.yahoo.com/quote/SNAP](http://finance.yahoo.com/quote/SNAP)

[http://www.nasdaq.com/symbol/snap](http://www.nasdaq.com/symbol/snap)

Not on Google Finance yet:

[https://www.google.com/finance?q=NYSE:SNAP](https://www.google.com/finance?q=NYSE:SNAP)

------
Kazamai
Ignorance is bliss in a world where half the people at YC could develop the
core snap chat app in a week.

~~~
InternetUser
This point was addressed on HN by user ChuckMcM in November 2013, right after
Spiegel rejected Zuckerberg's buyout attempt:

> The focus here is on the tech and not the market. A pet rock was 'worthless'
> (the rock was just a rock) but the connection with a generation was
> valuable. So often in our business we look at something that we feel like we
> could build (or could be easily built) and a valuation, and focus on those
> two things. The parts we don't see we give little value to (350M snaps?
> Seriously? That is a boat load of engagement). Making anything that get 350M
> 13-23 yr olds engaged is a pretty huge deal. That is what is valuable with
> Snapchat, not the tech.

[https://news.ycombinator.com/item?id=6671371](https://news.ycombinator.com/item?id=6671371)

~~~
moolcool
The pet rock was also only on sale for about a year before being discontinued
due to poor sales.

------
pibefision
Reminds me of Twitter IPO... just wait.

~~~
moolcool
I think this will be worse. Snapchat isn't nearly as culturally sticky as
Twitter. Sites like Twitter, Instagram, and Facebook have a robust
friend/follower system, and users have a huge backlog of things they
contributed to the platforms. No contributions on Snapchat last more than a
single day, so what is motivating users to stay on the platform instead of
using Facebook or Instagram's offerings? Their friends lists exist both of
those places too. In 10 years we'll look back on Snapchat as a flash in the
pan.

~~~
jeffbax
I think Snap has potential to be huge… anything that wins the race to replace
TV is going to be big. Whether they can do it before FB clones them/leverages
their network is a big open question.

That said, despite the fact that I love Twitter more than any other network,
almost none of my friends use it maybe ~a dozen people I know closely in real
life still post to it. Almost all of my friends use Snapchat and complain
about my lack of engagement with it.

Anecdotal, but I don't think they are comparable… additionally if your (likely
closer nit group of vs. FB's "everyone you know") friends aren't posting,
brands are putting up a TON that people seem to really like.

~~~
moolcool
Snap is the last thing that would replace TV. Nobody sits down and spends a
consecutive hour on Snapchat

~~~
slackoverflower
Neither does anyone an hour watching TV anymore? Everyone within the age range
18-30 in the US definitely spends more time on Snapchat than TV right now.

~~~
chris_7
The popularity of HBO prestige dramas would contradict that... plenty of
people watch hour long shows.

------
notadoc
I can't help but remember this Frontline from 2002

[https://www.youtube.com/watch?v=c4TlmkhE3Mw](https://www.youtube.com/watch?v=c4TlmkhE3Mw)

Is Snapchat really worth more than CBS? More than Thomson Reuters? Intuit? HP?
Nokia? Discover? EA? Why?

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jedberg
Looks like they are going to close with a market cap approximately three times
that of Twitter...

~~~
econner
It's interesting to compare the two IPOs. Twitter opened at $26 and closed at
$44 at a valuation of $25bn. Twitter had $650M revenue in 2013 for EBITDA of
-$525M. Snap closed at $28bn valuation, had $404M in revenue in 2016, and
EBITDA of -$460M. Twitter had roughly 100M DAUs and 230M MAU whereas Snap has
150M DAU and over 300M MAU. Snap is also 2 years younger than Twitter was and
the number of minutes spent on the platform per user is much higher.

So, all the numbers are wacky and who knows.

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miles_matthias
Can we take a second to laugh at the guys wearing spectacles on the trading
floor at 9am?

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gumby
What is the justification for celebrating the big jump in first day price? Why
isn't it a condemnation of the banks who got SNAP to leave a lot of money on
the table?

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cwkoss
I wonder how much child pornography goes through snapchat. Given the
demographics of their users, I'd bet it's quite a lot. Seems like a pretty
major business risk.

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adventured
You're incorrect, it's a near-zero business risk. The laws regarding how to
deal with it are well developed at this point. Reddit, Imgur, Google,
Facebook, Instagram, Viber, Kik, Gmail, Hotmail, Yahoo, Twitter etc - all have
or have had a similar challenge in dealing with it in regards to scale, but in
the case of Google or Facebook they're dealing with a drastically larger scale
problem than Snapchat will ever see. All Snapchat has to do is follow the same
laws that all the other hundreds of popular Internet companies do.

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synaesthesisx
SNAP's real value lies in its future as an augmented reality company. They've
spent something close to $1B in R&D - likely going toward hardware or
something...

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catshirt
what gave it away? was it the VR hardware announcement they made a few months
ago? :)

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bdrool
For reference:

\- Snapchat is now worth nearly 10x Facebook's acquisition offer from 2013

\- Snapchat is also worth ~1/14th of Facebook's worth

\- Snapchat is also worth somewhere in the range of 2-3x Twitter

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bronz
>Shares opened at $24 and traded as high as $25.42 apiece Thursday, giving the
company a market valuation of about $29 billion

there is no way for me to look at that and not be dumbfounded. some companies
are unprofitable but still have a clear mechanism through which they could
make money. tesla sells cars, for example. twitter and snap on the other hand
have no way to make enough money to justify the hype. they can sell peoples
data -- and that is a form of revenue that may face massive backlash and
cooling very soon. this market cap is insane and we are in a huge bubble.

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dovin
Interesting. Bitcoin is trading at an all-time high today. I guess the fears
of a tech bubble collapse have been staved off for a little while, at least.

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paulpauper
People have been predicting bubble and collapse since 2012...stopped clock
theory

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dovin
Of course, but it still is a good idea to think critically about the
possibility that tech companies are seriously overvalued. The chance of a
bubble bursting in any given year are probably low, but that there will be a
downturn is inevitable. And when that does happen I'll want to be paying
attention so I can see it coming as far out as possible.

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facepalm
Is Snapchat strictly for entertainment, or is it also a way to stay up to date
by following Tech influencers (like Twitter)?

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paulpauper
Bought some shares this morning. With 30-40% profit margin and huge growth,
imho this will go higher.

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krallja
So, would you call this a Snap pop?

