b) They have one of the fastest growing user bases in the social space, their users spends an astounding amount of time on the app (estimated at 30 minutes per day), and their user base is the most targeted demographic for demographics. Also they have literally barely turned on the advertising machine and their initial forays have already hit a revenue run rate of $300M+.
So essentially they have a shitload of eyeballs, the eyeballs are growing massively, their eyeballs spend a lot of time on their app, and advertisers love those eyeballs. Their business valuation is based on massive potential, not current revenues, but their advertising efforts already show huge promise. There is almost no startup with anything close to their engagement, growth, and monetization potential and the last company that looked like them was Facebook. Hence, the HYPE.
Because advertising isn't working for the people that sell "things." If social networks are supposed to create spending/buying in retail (both online and meatspace) they are not doing a very good job. Google: Retail sales 2016.
Or when Mom and Dad discover it and try to move in.
I don't know about you guys, but my friends spend probably upwards of an hour a day at least.
I spend more money in a month at 25 than I did in a year at 18 and with less thought put into it too. I would have assumed people like me would be the primary advertising target demographic.