Snap Inc. Gears Up to Go Public
Snap Inc., the company formerly known as Snapchat, is gearing up to go public. The company recently filed the paperwork for their initial public offering (IPO) and has valued the company at around US$ 20 to 25 billion. This would easily make it one of the highest stock unveilings in the past few years.
Currently most social media platforms like Twitter and Vine (which has closed shop), are struggling to make a profit. This is why most of the public is speculating about whether the IPO of Snap Inc. is too high. Though Snapchat is just four years old, the company is actually doing far better than its competitors and has a user base that crosses over 150 million.
According to the Wall Street Journal, the majority of Snap Inc.’s profits have come from the advertising space that they sell and post between their media partners Snap Stories. The app even allows companies to buy location or event based geo-filters. For example, a user in St. Catharines, will see filters that are advertising landmarks like the Port Dalhousie Lighthouse or the Garden City.
Students of a particular college or school can also see filters that feature their college in the background. One difficulty that might perhaps arise as Snap Inc. grows into its large market share, is that advertisers will probably have a tougher time getting their advertisements approved.
Facebook, one of Snapchat’s biggest rivals became a public company in the year 2012. At that juncture it was valued at more than $US100 billion with individual shares selling for as much as US$38. However post the IPO, the value of the social media giant significantly dropped to around US$80.
Snap Inc. which was renamed just earlier this year, has shown signs of expanding their business beyond their flagship photo sharing and chat application. One such product was their Snap glasses which allow a user to capture short video clips, from the perspective of their own eyes.
As of now, the IPO is expected to be revealed in March, 2017.
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Picture courtesy – wsj.net, ytimg.com
by techtalks @TechTalks November 29, 2016 6:26 AM UTC