

How Did Snapchat Reach a Rumored $3.5B Valuation? - ghosh
http://www.growthhackers.com/companies/snapchat/

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onion2k
"Photos shared/day Facebook - 350m Snapchat - 350m"

Apples and oranges there. A share on Facebook reaches all the friends (or
list) the user chooses while on Snapchat it's just one person. A photo on
Facebook can be reshared further with the possibility of virality, on Snapchat
it lasts 10s and then it's gone. A photo on Facebook can be captioned, tagged,
located, etc, while on Snapchat it's limited to a caption. And so on.

I don't doubt that Snapchat has a great deal of value because I don't see an
occasional short-lived advert image/video deterring many of the core users,
but to suggest that it has the same impact as Facebook's photo sharing
offering is completely ludicrous. They're different beasts beyond the entirely
superficial 'sending photos to other people' similarity.

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morganb180
"...but to suggest that it has the same impact as Facebook's photo sharing
offering is completely ludicrous."

The point of Benedict's tweet, which is not associated with the analysis in
any way, is merely a way to look at the traction or activity on the platforms.
Totally agree that they're not one in the same—one is a "messaging" app, while
the other is a network; but I do think that it shows that Snapchat is very
much a real and budding user base that is not just a flash in the pan.

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robmil
It's at such a fragile point, though. Monetising a previously entirely free
service is risky at any time, but there's lots more risk than usual here
(fickleness of audience, existence of competitors, fundamental simplicity of
offering).

We've seen plenty of startups fail at this point before; is there anything to
suggest Snapchat will beat the odds?

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cpsaltis
Assuming an average valuation/yearly revenue ~= 20 it means that for $3.5bn
the should make $175m a year. If they have 350m photo shares a day (!!!) this
number seems very well within their reach. They can even afford to monetize
less aggressively and thus more user-friendly. I think it's one of these cases
where numbers are so huge that they work in their favor whatever they do.

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seanellis
20X revenue would be a really high valuation even for a SaaS business. 6-10X
would be more likely in the long run.

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carlosrt
When Twitter had ~$140M in revenue their price was ~50x revenue.

Source: [http://www.quora.com/What-are-revenue-multiples-for-
technolo...](http://www.quora.com/What-are-revenue-multiples-for-technology-
startups)

