Snap values itself at nearly $24B with its IPO pricing(techcrunch.com)
techcrunch.com
Snap values itself at nearly $24B with its IPO pricing
https://techcrunch.com/2017/03/01/snap-values-itself-at-nearly-24b-with-its-ipo-pricing/
163 comments
It is advantageous to be in a business everyone else thinks isn't worth being in.
Whether it is because the business model is terrible (they make all of their money on ads) or the app can't possible have users (it looks horrible and I can't figure it out), the end result is the same - less competition and more breathing room to have a shot at succeeding.
I'm not buying at the IPO but I'll be keeping a close eye on the stock and how Spectacles works out (waiting for a pair now.)
Whether it is because the business model is terrible (they make all of their money on ads) or the app can't possible have users (it looks horrible and I can't figure it out), the end result is the same - less competition and more breathing room to have a shot at succeeding.
I'm not buying at the IPO but I'll be keeping a close eye on the stock and how Spectacles works out (waiting for a pair now.)
None of those companies are start-ups. Companies that are truly start-ups have little to zero revenue and little to zero name recognition. The companies you mentioned have passed the start-up phase but have yet to reach the Goliath phase (Amazon, Google, etc). They all have/had escape velocity and are/were on the upwards trajectory.
Well yeah, but they were at least more of a "startup" a few years ago when I wanted to work there. My main point was: look how they turned out despite the hype or industry experts predictions.
I definitely don't get snapchat. Too old, not playing.
That said, if you don't understand a company, man, you should stay far, far away from investing in it.
And I don't use DropBox. I use Google Drive. For free.
Where's that Dropbox IPO at anyways?
That said, if you don't understand a company, man, you should stay far, far away from investing in it.
And I don't use DropBox. I use Google Drive. For free.
Where's that Dropbox IPO at anyways?
This is good advice. Peter Lynch puts it best (and actually, he was misquoted about the mall story 25+years ago): https://www.wsj.com/articles/peter-lynch-25-years-later-its-...
tl;dr you better really know what you're investing in. If you don't know, don't invest even if you miss out on the next "big thing".
tl;dr you better really know what you're investing in. If you don't know, don't invest even if you miss out on the next "big thing".
I downloaded Snapchat when they first busted onto the scene to see what it was all about. I was constantly being told by a close friend to download it so that she could snap with me.
I thought it was a poor means of communicating and though the snaps were just noise that I didnt need.
I jumped onto Facebook's IPO but snapchat I definitely wouldn't touch.
I thought it was a poor means of communicating and though the snaps were just noise that I didnt need.
I jumped onto Facebook's IPO but snapchat I definitely wouldn't touch.
I use snapchat every single day. Not a Facebook user anymore. They've got a really stronghold on 18-25 year old market.
Facebook sees snap as a threat and they literally ripped snapchat in whatsapp "status".
I can't say that it will beat Facebook but I'm willing to bet it will be more valuable than twitter. I will buy if it's share price is not too hyped.
Facebook sees snap as a threat and they literally ripped snapchat in whatsapp "status".
I can't say that it will beat Facebook but I'm willing to bet it will be more valuable than twitter. I will buy if it's share price is not too hyped.
I have no way of predicting Snap’s future, but I am certain that tomorrow, the founders and VCs will take hundreds of millions off the table through share sales, the investment bankers will earn fat fees, ditto the deal lawyers, some people will buy in hoping for a quick buck on a first-day big pop, and founders and VCs all around will be looking for increased pre-IPO valuations. That’s what this show is, and the rest is just speculation.
> long way of saying that no one knows what the hell they are talking about when they discuss these companies
And in some cases, they have vested interests in the success or failure of these companies.
And in some cases, they have vested interests in the success or failure of these companies.
People are asking if Snap is more Twitter or Facebook. From my (light) exposure, it doesn't seem like either. It's more like a lifestyle-aware replacement for Apple Messages + Camera -- two of the most heavily used apps on any phone. (For Android, replace Apple Messages with whatever Google calls their text chat app this week.)
The closest comparison could be WhatsApp, and that was valued at $19 billion. So I'm not sure that Snap's valuation is as outrageous as it seems based on traditional metrics.
Also, I've been really impressed by the design of the Spectacles. The yellow charging case is a brilliant way to make the glasses lighter. Snap is the only major tech company that understands anything about playful design -- Apple, Google, Facebook and Microsoft are all treading the same safe paths of post-Jobsian blandness.
The closest comparison could be WhatsApp, and that was valued at $19 billion. So I'm not sure that Snap's valuation is as outrageous as it seems based on traditional metrics.
Also, I've been really impressed by the design of the Spectacles. The yellow charging case is a brilliant way to make the glasses lighter. Snap is the only major tech company that understands anything about playful design -- Apple, Google, Facebook and Microsoft are all treading the same safe paths of post-Jobsian blandness.
The key to understanding snap is that it's more messaging app than social network, but neither border is well defined.
Also, it's a bit data intensive
Also, it's a bit data intensive
I think when people say is Snap a Twitter or Facebook they are wondering if it will +350% or -60% in the first few years after IPO.
Snap's data has real value, like Facebook's. For most of their users, they have a large portion of their phone's contacts (whether you opt in or not is irrelevant due to your contacts opting into this + a network effect.) They also have media preferences based on what articles you're watching/reading. They also know who you're most interested in (who's stories you're watching most, and who you send/receive snaps from the most) and what their interests are, so they can potentially infer interests from that too, even if you don't read articles. They have location data turned on for most of their users thanks to geo filters, and if they've been "good" data miners, they're sending your facial mapping home when you do a face filter effect. I'd be surprised if Snap doesn't have the most comprehensive faces database out there with all the angles they get from selfies (though they may not have the most unique faces.)
Oh yeah, and they also have the perceived privacy that Facebook doesn't have. Deleting messages doesn't actually delete them, but it just feels better when they're gone, so people are more candid on Snapchat.
Not to mention they've also done an excellent job monetizing their features thus far, with very little intrusion that I've noticed as a user. You get the occasional ad when you're looking through stories, but most of the money is coming from things like sponsored content and geo filters, which users don't complain about.
Oh yeah, and they also have the perceived privacy that Facebook doesn't have. Deleting messages doesn't actually delete them, but it just feels better when they're gone, so people are more candid on Snapchat.
Not to mention they've also done an excellent job monetizing their features thus far, with very little intrusion that I've noticed as a user. You get the occasional ad when you're looking through stories, but most of the money is coming from things like sponsored content and geo filters, which users don't complain about.
>For most of their users, they have a large portion of their phone's contacts
Just about every app can collect this information.
>Snap's data has real value
My only disagreement is that its all fake usernames. The friend graph is not as accurate as its like Kik, Myspace, Instagram and twitter in that people will add random people from all different sources, and make connections as there are no real threats to "real life" and "online life". with facebook you at least have a more signals into a "real life" graph and with twitter you have an interest graph. With Snap I don't think either of their signals (stories, friends) are as good.
Just about every app can collect this information.
>Snap's data has real value
My only disagreement is that its all fake usernames. The friend graph is not as accurate as its like Kik, Myspace, Instagram and twitter in that people will add random people from all different sources, and make connections as there are no real threats to "real life" and "online life". with facebook you at least have a more signals into a "real life" graph and with twitter you have an interest graph. With Snap I don't think either of their signals (stories, friends) are as good.
> My only disagreement is that its all fake usernames
Plenty of people have added their real names in addition to their usernames. But even if they don't, contact lists often have real names.
I'm not sure if that's how you use Snapchat, but personally (and I may be in the minority) I only add people I've either met, or who are in some capacity a celebrity. You can also typically see how close a friend someone is by how many connections they have to other friends in a user's network. Snap users (like Facebook users, I think?) also tend to mostly interact with people they're actually friends with. So at the very least I think the data Snap has is at least as high quality as FB's (and I'm not at all disappointed we're comparing more with Facebook than Twitter, as the latter has had a much more positive market story.)
Plenty of people have added their real names in addition to their usernames. But even if they don't, contact lists often have real names.
I'm not sure if that's how you use Snapchat, but personally (and I may be in the minority) I only add people I've either met, or who are in some capacity a celebrity. You can also typically see how close a friend someone is by how many connections they have to other friends in a user's network. Snap users (like Facebook users, I think?) also tend to mostly interact with people they're actually friends with. So at the very least I think the data Snap has is at least as high quality as FB's (and I'm not at all disappointed we're comparing more with Facebook than Twitter, as the latter has had a much more positive market story.)
I know both of our experiences are anecdotal, but the way I see people asking for their snap is pretty lax. Snap or Kik is how I see in many ways the first contact that millenials ask for passive connections whether it be online or irl. For more closer connections its a phone number and fb messenger in the US.
>close a friend someone is by how many connections they have to other friends in a user's network
Again every messaging app that asks for contacts has these connections. FB messenger, Line, Wechat etc has more data points than snap when it comes to this.
>I'm not at all disappointed we're comparing more with Facebook
I would actually compare it closer to twitter. If they are going in the direction of media as they've already announced they are building an interest graph.
>close a friend someone is by how many connections they have to other friends in a user's network
Again every messaging app that asks for contacts has these connections. FB messenger, Line, Wechat etc has more data points than snap when it comes to this.
>I'm not at all disappointed we're comparing more with Facebook
I would actually compare it closer to twitter. If they are going in the direction of media as they've already announced they are building an interest graph.
Twitter has all the same data and they still can't make money at scale. It's hard, only two companies have done it.
For what it's worth, I talked to a Snapchat engineer at a job fair, and he told me that Snapchat is trying to focus on new products and features (like Spectacles) more so than trying to monetize their data.
I've heard that. Snap considers itself akin to a camera company. Will be interesting to see where things go, but I don't like the valuation.
And Snapchat recruiters are talking to me about coming over and helping their data scientists productionize their models and monetize their data. Why not both?
There's a lot of misinformation in this reply.
> ...they're sending your facial mapping home when you do a face filter effect...
Lenses are generated on the device. They're not uploaded to Snapchat servers.
> Deleting messages doesn't actually delete them...
From the support site: "Snapchat servers are designed to automatically delete Snaps after they've been viewed by all recipients."
https://support.snapchat.com/en-US/a/when-are-snaps-chats-de...
> ...they're sending your facial mapping home when you do a face filter effect...
Lenses are generated on the device. They're not uploaded to Snapchat servers.
> Deleting messages doesn't actually delete them...
From the support site: "Snapchat servers are designed to automatically delete Snaps after they've been viewed by all recipients."
https://support.snapchat.com/en-US/a/when-are-snaps-chats-de...
> Lenses are generated on the device. They're not uploaded to Snapchat servers.
Context is very important when you're quoting people: "... and if they've been "good" data miners..."
And regardless of whether or not a filter is generated on device, facial data is being used, and so I'm weary that it could be sent to a server. If it's not, fine, but that's subject to change.
> From the support site: "Snapchat servers are designed to automatically delete Snaps after they've been viewed by all recipients."
So when authorities get involved, I'm sure Snap says "sorry, can't do anything for you"?
Context is very important when you're quoting people: "... and if they've been "good" data miners..."
And regardless of whether or not a filter is generated on device, facial data is being used, and so I'm weary that it could be sent to a server. If it's not, fine, but that's subject to change.
> From the support site: "Snapchat servers are designed to automatically delete Snaps after they've been viewed by all recipients."
So when authorities get involved, I'm sure Snap says "sorry, can't do anything for you"?
> So when authorities get involved, I'm sure Snap says "sorry, can't do anything for you"?
Why not? Obviously it's nonfree software so neither of us really know, but the alternative is that they're simply lying. Maybe they are, but that sounds like a ticking time bomb that would destroy them when it gets out. And it would absolutely get out, especially if they try to monetize it as an above poster suggested.
Why not? Obviously it's nonfree software so neither of us really know, but the alternative is that they're simply lying. Maybe they are, but that sounds like a ticking time bomb that would destroy them when it gets out. And it would absolutely get out, especially if they try to monetize it as an above poster suggested.
I wouldn't consider it a ticking time bomb. They provide a (false) guarantee to the end user that other users won't be able to capture whatever you sent beyond the time given for them to view it. (This is false because anyone can take a picture of their phone's screen.) Users would understand the very reasonable difference between users having general access to this "expired" data vs. the police. Most people should expect that the police have special privileges in this case, and I don't think there'd be any backlash if this became broader knowledge. Their promise to their users is to provide them with the secrecy of a "secret note", not government proof secure encrypted messaging.
The number I've seen around is that Snap keeps messages on it's servers for two weeks for the authorities(presumably that's also their timeout for a user to download the image).
Maybe it will be neither? I could well see Snap sitting at roughly its IPO price or slightly below two years from now. That's the risk of a high-priced initial offering -- the success will need to be extraordinary to drive the stock still higher.
Or user growth.
I think a better comparison is Line Corp traded on NYSE and
WhatsApp is the most used messager with 90%+ market penetration. It has more than a billion users globally. Snap is nowhere near that user base.
Indeed. In some countries, people book doctor appointments using WhatsApp.
SnapChat has always looked like a solution to a "first world problem" to me. Very US and LA/NYC-centric.
Granted, I'm old, but even in rich European countries, I'm not sure it has potential to do well? (Honest question, I really wonder).
SnapChat has always looked like a solution to a "first world problem" to me. Very US and LA/NYC-centric.
Granted, I'm old, but even in rich European countries, I'm not sure it has potential to do well? (Honest question, I really wonder).
Anecdote, but upwards of 80% of people younger than 25 I interact with in Germany use snapchat.
Viber is kind of a big deal also!
Whatsapp was privately valued at $19B by way of acquisition. Proactively buying growing competitors to defend a moat, even competitors with hundreds of millions of users, does not establish a valuation the same way an IPO does.
I don't have a strong opinion on Snap's IPO (I guess I hope it does well for industry health?) but I strongly push back on using private acquisitions as a barometer of IPO health.
I don't have a strong opinion on Snap's IPO (I guess I hope it does well for industry health?) but I strongly push back on using private acquisitions as a barometer of IPO health.
Agreed with you that delightful playfulness is sorely lacking these days, and that all the established players are fairly uninspired.
Sony has had some designers that just get it over the decades, but sadly they're all over the place. Weird Sony is amazing - see http://www.theverge.com/2013/9/29/4783132/the-amazing-produc... .
Nintendo has also some inspired moments, but they stumble a lot.
Sony has had some designers that just get it over the decades, but sadly they're all over the place. Weird Sony is amazing - see http://www.theverge.com/2013/9/29/4783132/the-amazing-produc... .
Nintendo has also some inspired moments, but they stumble a lot.
One way Snap is more like Twitter: the length of your messages are "artificially" limited. (Temporally in the case of Snap.)
Apple's AirPod design (while more sleek than playful) is quite opinionated and beautiful IMO. It also shifts charging responsibility to the case.
If you have a large amount of money you don't mind gambling with and can afford to stay solvent longer than the market can stay irrational, I feel like this is the best short ever.
My 5 year target on SNAP would be roughly one can of Pringles. When the next market meltdown happens, Michael Lewis will write a great book about people buying non-voting shares of a fad company at a $24b valuation that says in its prospectus that it has no plans to make money and maybe never will.
Or I'm wrong and they won't be a fad and will figure out how to monetize, but I feel like the multiplied probabilities of both make it as clear a bet as you ever get.
My 5 year target on SNAP would be roughly one can of Pringles. When the next market meltdown happens, Michael Lewis will write a great book about people buying non-voting shares of a fad company at a $24b valuation that says in its prospectus that it has no plans to make money and maybe never will.
Or I'm wrong and they won't be a fad and will figure out how to monetize, but I feel like the multiplied probabilities of both make it as clear a bet as you ever get.
Have you ever shorted a company? It really isn't advice you should be loosely throwing about - the potential downside is unlimited. It really is a tool reserved for those with special broker access and a better understanding of what it means.
Further, if anybody had actually followed any of the short advice that has been given in HN comments in the past 10 years, they almost certainly would have lost unlimited amounts of money.
If you really want to put your money where your mouth is, post some bitcoin, a term period and a price target and see if anyone takes you up one it. I'd almost certainly book everything you offer on SNAP going to $0 in 5 years.
Further, if anybody had actually followed any of the short advice that has been given in HN comments in the past 10 years, they almost certainly would have lost unlimited amounts of money.
If you really want to put your money where your mouth is, post some bitcoin, a term period and a price target and see if anyone takes you up one it. I'd almost certainly book everything you offer on SNAP going to $0 in 5 years.
One could buy long-term (LEAPS) put options to bet against a company, avoiding the unlimited downside of a naked short.
It will probably take several weeks before it is possible to purchase put options on Snap.
The cost of LEAPS is very high when they are purchased on speculative companies. For example, take Tesla.
Tesla closed today at $250. To purchase an "at the money" $250 put dated January 2019 (aka a LEAP) would cost you $54. So TSLA stock would need to fall below $196 at expiration before you began to make money on it. That's a simplification because you could always sell your put early, possibly at a profit. Buying a January 2018 put would be cheaper, but still quite expensive at $37.
To reduce the cost of a put you can buy one that is "out of the money". For example the TSLA $200 put dated January 2019 would be cheaper, only $31. However, TSLA would need to fall below $169 before you made any money at expiration.
So, look at that last example. TSLA now $250, you pay $31 now and you don't make money unless TSLA closes below $169 at expiration.
Math like that is why sophisticated investors often short stock rather than buy puts. They need to pay a price to "borrow" the stock to short but for many companies that price is quite low, below 10% a year. The cost of buying put options on the same stock could be two or three times as high as directly shorting the stock.
When SNAP puts become available I expect the math to be much worse than for TSLA. It will cost A LOT to buy puts on such a speculative company. In trader talk, the "implied volatility" will be very high.
The cost of LEAPS is very high when they are purchased on speculative companies. For example, take Tesla.
Tesla closed today at $250. To purchase an "at the money" $250 put dated January 2019 (aka a LEAP) would cost you $54. So TSLA stock would need to fall below $196 at expiration before you began to make money on it. That's a simplification because you could always sell your put early, possibly at a profit. Buying a January 2018 put would be cheaper, but still quite expensive at $37.
To reduce the cost of a put you can buy one that is "out of the money". For example the TSLA $200 put dated January 2019 would be cheaper, only $31. However, TSLA would need to fall below $169 before you made any money at expiration.
So, look at that last example. TSLA now $250, you pay $31 now and you don't make money unless TSLA closes below $169 at expiration.
Math like that is why sophisticated investors often short stock rather than buy puts. They need to pay a price to "borrow" the stock to short but for many companies that price is quite low, below 10% a year. The cost of buying put options on the same stock could be two or three times as high as directly shorting the stock.
When SNAP puts become available I expect the math to be much worse than for TSLA. It will cost A LOT to buy puts on such a speculative company. In trader talk, the "implied volatility" will be very high.
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with a price target of $0 you could buy them all day, especially in a market where actual frauds and ponzi schemes don't go to $0
Yeah well I thought GOOG was a dumb investment since >95% of their revenue came from AdWords and surely MSFT & others would pump billions in and make a real dent.
The vast majority of their revenue is still from AdWords despite those billions being spent, but that GOOG pie's only grown over time.
The vast majority of their revenue is still from AdWords despite those billions being spent, but that GOOG pie's only grown over time.
I shorted Google back in the day! Gave up once I lost $500 or so.
I guess in tech sometimes you just have to expect the competitors to be too incompetent/short-sighted to be an existential threat. That's how I always understood Apple's survival, at least.
> you just have to expect the competitors to be too incompetent/short-sighted
Same probably goes to %99.9 of all investors as well, otherwise those %99.9 would have been rich from buying Google after their IPO.
Being short sighted is a humans' thing, probably. not a tech CEOs' thing..
Same probably goes to %99.9 of all investors as well, otherwise those %99.9 would have been rich from buying Google after their IPO.
Being short sighted is a humans' thing, probably. not a tech CEOs' thing..
Buying Google at the IPO wouldn't have made most investors rich anyway. They IPO'd with far too high of a market cap already (as contrasted to Microsoft, Oracle, Dell, Cisco, etc. from the prior generation).
A 17x return over 12 years won't make most (non-rich) investors rich unless they bet every dollar they have on said investment (a nearly impossible and entirely impractical scenario).
An average investor betting $10,000 - $25,000 on Google's IPO would be a serious investment. $170,000 - $425,000 is a great return off of that, it's just not anywhere near rich.
Had they IPO'd at something more like what tech companies used to, an investor could have seen a 250x to 1000x return up to this point. That would make you rich off of a $10k bet. Amazon for example, has produced something like a 560x return so far from the IPO.
A 17x return over 12 years won't make most (non-rich) investors rich unless they bet every dollar they have on said investment (a nearly impossible and entirely impractical scenario).
An average investor betting $10,000 - $25,000 on Google's IPO would be a serious investment. $170,000 - $425,000 is a great return off of that, it's just not anywhere near rich.
Had they IPO'd at something more like what tech companies used to, an investor could have seen a 250x to 1000x return up to this point. That would make you rich off of a $10k bet. Amazon for example, has produced something like a 560x return so far from the IPO.
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They've already figured out how to monetize, and did $400M in revenue last year. I do think that the $24B valuation is a bit high, but I don't think it's "the best short ever."
That's the beauty of the market. You put your money where you mouth is or shut the f up.
> says in its prospectus that it has no plans to make money and maybe never will
Assuming you are talking about this sentence from the "risk factors" section of their S-1:
> We have incurred operating losses in the past, expect to incur operating losses in the future, and may never achieve or maintain profitability.
That's relatively boilerplate and doesn't really mean much. The "risk factors" section is always very gloom-and-doom to avoid the appearance of over-promising returns. For example, Workday said "we have a history of cumulative losses and we do not expect to be profitable for the foreseeable future" in their risk factors. Shake Shack included "our inability to open profitable Shacks" as a risk factor in their S-1. Google listed pages and pages of "risks" that basically boiled down to "advertisers might stop using us". It's really not that unusual to say something like that.
You might be right and Snap could be headed for a big fall, but that statement alone isn't much of an indicator.
Assuming you are talking about this sentence from the "risk factors" section of their S-1:
> We have incurred operating losses in the past, expect to incur operating losses in the future, and may never achieve or maintain profitability.
That's relatively boilerplate and doesn't really mean much. The "risk factors" section is always very gloom-and-doom to avoid the appearance of over-promising returns. For example, Workday said "we have a history of cumulative losses and we do not expect to be profitable for the foreseeable future" in their risk factors. Shake Shack included "our inability to open profitable Shacks" as a risk factor in their S-1. Google listed pages and pages of "risks" that basically boiled down to "advertisers might stop using us". It's really not that unusual to say something like that.
You might be right and Snap could be headed for a big fall, but that statement alone isn't much of an indicator.
> My 5 year target on SNAP would be roughly one can of Pringles.
What does this sentence mean?
What does this sentence mean?
They expect the value of the company to be equivalent to the value of a can of potato chips; approximately $0.
"Pringles" is a "pack of chips" (more or less), so basically he means, "a pack of chips" is what the company will become. (this is what i understand :p )
He means that in 5 years the company will be worth about the price of one can of Pringles (chips/crisps in the US)
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Wow did 4 people respond to one comment at the same time?
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Shorting snap will be hard right after the IPO, but if SNAP tanks, the whole tech sector is going to fall over, so shorting basically anything is probably a strong play.
>so shorting basically anything is probably a strong play.
I'm positioning myself for massive fiscal stimulus (that was denied the Democratic president) and higher stock prices. I guess we'll see.
I'm positioning myself for massive fiscal stimulus (that was denied the Democratic president) and higher stock prices. I guess we'll see.
Republicans are basically ideologically opposed to fiscal stimulus and all their signals are on massive cuts to non-defense, non-law-enforcement spending (with the main debates among Republicans being over how massive those cuts should be and where they are targeted), so good luck with that.
The closest thing to fiscal stimulus we're likely to see is top-weighted tax cuts, which are ineffective stimulus at best, and what benefit can be derived from them has pretty well been looked over the last several decades.
OTOH, top-weighted and particularly corporate tax cuts are likely to improve stock market returns in the short term, so, maybe not so bad a position to be in if you can time your exit right.
The closest thing to fiscal stimulus we're likely to see is top-weighted tax cuts, which are ineffective stimulus at best, and what benefit can be derived from them has pretty well been looked over the last several decades.
OTOH, top-weighted and particularly corporate tax cuts are likely to improve stock market returns in the short term, so, maybe not so bad a position to be in if you can time your exit right.
Why would the tech sector be generally affected?
We haven't seen a good tech IPO in a while. Given that and the supposed diminishing funding the Snapchat IPO will set a signal. If Snapchat crashes it will reinforce the narrative that tech is in trouble.
All the unicorns are going to have valuations looked at again, which is going to make it hard for them to raise money, which is going mean they'll have to lay people off which is going to have ripple effects throughout the economy. Might not impact google much, but it'll hit amazon for sure as stuff like aws spending gets looked at.
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> I feel like this is the best short ever
'feeling like' is not a good way to convincing me to short something. nor long. nor anything ;)
> ..., but I feel like the multiplied probabilities of both make it as clear a bet as you ever get
So you 'feel' like it would be a 'clear bet' ? sounds like a big maybe to me.
How about NOT shorting/longing at all ? I feel like this is the clearest bet for me ;)
(edit: spacing)
'feeling like' is not a good way to convincing me to short something. nor long. nor anything ;)
> ..., but I feel like the multiplied probabilities of both make it as clear a bet as you ever get
So you 'feel' like it would be a 'clear bet' ? sounds like a big maybe to me.
How about NOT shorting/longing at all ? I feel like this is the clearest bet for me ;)
(edit: spacing)
They are pricing right at the top of their range with this if the rumors are true. I don't think they are announcing hte actual price until after the close.
One one hand raising as much as possible is very nice for the company but to temper that sentiment I think it was Robin Li, the Baidu founder, who made the comment that while he was very happy with the first day pop his stock had, it was an actual curse.
he was prepared to run an XX Billion dollar business and hit his targets but with the opening day pop he was now running a 2X Billion dollar business and that made things significantly harder than if the stock had risen gently over the course of 4-8 quarters.
I wish the Snap team well, but they'll have a few hiccups coming.
They've been private long enough that a deluge of shares will come free trading this year and they'll at some point have to do the tight rope walk of switching from telling wall street to look at user growth to looking at profits.
If you want to invest I'll quote someone sitting beside me. "The problem with Snap is determining if they are more Twitter or Facebook."
From a wall street perspective this IPO was a bit different. It was about 10x oversubscribed, which is alot but not uncommon. What was interesting was that alot of mutual funds got almost full allocations and hedge funds were shut out compared to what they would normally get.
Maybe this is a good thing?
One one hand raising as much as possible is very nice for the company but to temper that sentiment I think it was Robin Li, the Baidu founder, who made the comment that while he was very happy with the first day pop his stock had, it was an actual curse.
he was prepared to run an XX Billion dollar business and hit his targets but with the opening day pop he was now running a 2X Billion dollar business and that made things significantly harder than if the stock had risen gently over the course of 4-8 quarters.
I wish the Snap team well, but they'll have a few hiccups coming.
They've been private long enough that a deluge of shares will come free trading this year and they'll at some point have to do the tight rope walk of switching from telling wall street to look at user growth to looking at profits.
If you want to invest I'll quote someone sitting beside me. "The problem with Snap is determining if they are more Twitter or Facebook."
From a wall street perspective this IPO was a bit different. It was about 10x oversubscribed, which is alot but not uncommon. What was interesting was that alot of mutual funds got almost full allocations and hedge funds were shut out compared to what they would normally get.
Maybe this is a good thing?
Anyone knows their growth numbers since the introduction of Instagram Stories? For influencers with a following in the 18+ age range this was the day a lot quit Snapchat (including myself).
This techcrunch article has what you're after: https://techcrunch.com/2017/02/02/slowchat/.
They say growth slowed from 7% QOQ to 3.2% QOQ. Having only 3.2% Q4 QOQ growth is pretty worrying considering they had ~14% QOQ growth in every prior Q4.
They say growth slowed from 7% QOQ to 3.2% QOQ. Having only 3.2% Q4 QOQ growth is pretty worrying considering they had ~14% QOQ growth in every prior Q4.
Serious question: are the growth numbers scrutinized? How exactly are they calculated? It seems like down-playing growth numbers pre-IPO could leave more room for "awesome growth" in the first few post-IPO years. Maybe switch the way the numbers are calculated at the appropriate times.
> "$59 million in revenue in 2015 to nearly $400 million in 2016"
Valuation at 60x 2016 revenue with no profit? Oh boy.
Aside from that, who uses Snapchat?
Valuation at 60x 2016 revenue with no profit? Oh boy.
Aside from that, who uses Snapchat?
Snapchat is immensely more popular than Facebook for anyone under 25. They change and iterate their UI/UX quite often to confuse (keep away) adults from using it and "ruining" it for the younger audience.
Does anyone have a by country breakdown of snapchat users and growth? In Chile in my kids circle of friends, they used it a bit last year but have all deleted it now in favor of musically. Everyone here (kids and adults) also have whatsapp and I think the value of snapchat is even further diminished now that whatsapp is starting to clone some of the features.
I could see that, I thought Instagram and WhatsApp were popular with kids though.
that's so weird -- how could an adult intrude into a kid's snapchat conversation with other kids?
If you post something to your story and that might be OK if only people your age see it but you wouldn't your parents to see it.
Just like how people use Facebook before all their parents joined too.
Just like how people use Facebook before all their parents joined too.
People under 25.
>who uses Snapchat?
You're kidding, right? It passed 300 million monthly users almost a year ago.
We're all tech fuddy-duddies here, still stuck on linkedin and email FWDs, we don't know nuttin' bout dat snap.
You're kidding, right? It passed 300 million monthly users almost a year ago.
We're all tech fuddy-duddies here, still stuck on linkedin and email FWDs, we don't know nuttin' bout dat snap.
> You're kidding, right? It passed 300 million monthly users almost a year ago.
And not much more since then... Growth fell of a cliff once FB started to focus on copying their features (see Instagram Stories).
And not much more since then... Growth fell of a cliff once FB started to focus on copying their features (see Instagram Stories).
Right but aren't many kids using Instagram and other Facebook products now that they have adopted the Snapchat features? That's what I keep hearing anyway, no idea if it's reality or not.
>> who uses Snapchat?
This doctor: http://www.bbc.co.uk/news/technology-38314539
> UK teaching surgeon Dr Shafi Ahmed has "livestreamed" an operation using Snapchat spectacles, which are sunglasses with a small camera integrated, allowing the wearer to record what they are seeing.
(I think he had the @NHS twitter account for this week (27th March through to 5th April)
This doctor: http://www.bbc.co.uk/news/technology-38314539
> UK teaching surgeon Dr Shafi Ahmed has "livestreamed" an operation using Snapchat spectacles, which are sunglasses with a small camera integrated, allowing the wearer to record what they are seeing.
(I think he had the @NHS twitter account for this week (27th March through to 5th April)
Every single student in the high school I teach at uses Snapchat. All day. Every day.
On the other hand, high school apps tend to be fads that die out quickly. The college demographic is more sticky.
I graduated college in 2015 and I would say Snapchat is just as popular amongst my friend group as when we first started using it.
When my younger family members who are in high school and college want to contact me, they always start the conversation on Snapchat.
It's all anecdotal, but I think Snapchat has been outside the fad phase for awhile now.
When my younger family members who are in high school and college want to contact me, they always start the conversation on Snapchat.
It's all anecdotal, but I think Snapchat has been outside the fad phase for awhile now.
But that's exactly the point: snapchat hasn't been around for very long at all. Myspace and livejournal both stuck around for a bit too, doesn't mean they weren't fads.
You may not grow out of snapchat, but the youngs are guaranteed to move on to something else. That's the way it's gone for everything else, no reason for snapchat to be any different.
Doesn't mean they can't build a business around the audience they have, but I think expecting that audience to continue to grow significantly over the long term is a mistake.
You may not grow out of snapchat, but the youngs are guaranteed to move on to something else. That's the way it's gone for everything else, no reason for snapchat to be any different.
Doesn't mean they can't build a business around the audience they have, but I think expecting that audience to continue to grow significantly over the long term is a mistake.
>Every single student in the high school I teach at uses Snapchat. All day. Every day.
Are high-school students a lucrative market (and I'm not talking the mobile ad ponzi)? I was pretty poor at that age.
Are high-school students a lucrative market (and I'm not talking the mobile ad ponzi)? I was pretty poor at that age.
High school students have a lot of influence on what their parents spend on them for certain things like consumer electronics, restaurants, family vacations, clothes, etc. "Mom please buy me an Xbox for Christmas!"
It's accepted marketing lore that if you get brand loyalty during teenage years, it will probably stick for life.
There's a reason Coke and Pepsi are so aggressive at advertising to that demographic.
There's a reason Coke and Pepsi are so aggressive at advertising to that demographic.
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They grow up really quick. That's actually really nice for an investment, since you are literally betting on the future.
Do you let your students use cell phones in class?
I just deleted it from my phone. Only reason I installed it was because a girl I was seeing wanted me to.
I find this funny because that exact reason applies to multiple people I know as well.
Ditto. Except I haven't deleted it, but will probably be the first to go when I need space. I have no need for pictures that disappear.
I don't use Snap products, but from my totally uninformed, unengaged vantage point it seems to me that Snap is valuable because they present a different set of values to their users then Facebook, Google, etc.
Their first product wanted to challenge the permanence of our digital stuff. (Forget the underlying technology.)
The glasses are about challenging this kind of Google/Apple model of the person as some elegant cyborg from the Jetsons. They offered a toy for, like, just goofing off.
I imagine users like it because it's not crammed with ads and spam yet.
$24B is about half of what it costs to build high speed rail from LA to SF, or a third of what it might cost for a manned mission to Mars.
Compared to what it probably costs to operate and develop, $24B sounds redonkulous. Compared to those other projects, it's hard to see what Snap has that's so rare.
Maybe the better comparisons are Nike (market cap $95B) and Coca-Cola ($182B). Snap is using near-commodity economic inputs and outputs to express a point of view and build a brand.
All of this is speculation from my deep crater of ignorance.
Their first product wanted to challenge the permanence of our digital stuff. (Forget the underlying technology.)
The glasses are about challenging this kind of Google/Apple model of the person as some elegant cyborg from the Jetsons. They offered a toy for, like, just goofing off.
I imagine users like it because it's not crammed with ads and spam yet.
$24B is about half of what it costs to build high speed rail from LA to SF, or a third of what it might cost for a manned mission to Mars.
Compared to what it probably costs to operate and develop, $24B sounds redonkulous. Compared to those other projects, it's hard to see what Snap has that's so rare.
Maybe the better comparisons are Nike (market cap $95B) and Coca-Cola ($182B). Snap is using near-commodity economic inputs and outputs to express a point of view and build a brand.
All of this is speculation from my deep crater of ignorance.
Somehow I've managed to see exactly zero comments about Whatsapp stories in this thread, which really surprises me. I think that's a hell of a lot more scary to Snapchat than Instagram stories. Most people with Instagram have Snapchat, but most people with Whatsapp do not have Snapchat.
For those who don't know (and I don't know much) Whatsapp just launched a stories feature, similar to Instagram or Snapchat.
For those who don't know (and I don't know much) Whatsapp just launched a stories feature, similar to Instagram or Snapchat.
> I think that's a hell of a lot more scary to Snapchat than Instagram stories. Most people with Instagram have Snapchat, but most people with Whatsapp do not have Snapchat.
Neither of these sentences is accurate.
Neither of these sentences is accurate.
The first one's an opinion. In the second one, 'most people with Whatsapp do not have Snapchat' is just simple math - there are more than twice as many Whatsapp users compared to Snapchat. 'Most people with Instagram have Snapchat' is anecdotal, sure, but do you think that more than 50% of Instagram active users do not actively use Snapchat? I only know a handful of people that have Instagram that do not have Snapchat, and only two of those people are active Instagram users.
From your profile I can see you're a reporter, so if you have any access to hard data about this I'd love to hear what the real numbers are. Thanks!
From your profile I can see you're a reporter, so if you have any access to hard data about this I'd love to hear what the real numbers are. Thanks!
Instagram has ~400 million DAUs whereas Snapchat has ~160 million. Even if 100% of Snapchat users have Instagram accounts, it's still not most Instagram users. Maybe you're indexing on a different number, rather than DAUs?
Wasn't objecting to the part about Whatsapp, you're right there!
Wasn't objecting to the part about Whatsapp, you're right there!
Oh shoot, you're right! I only bothered to google Instagram DAUs and didn't even bother for Snapchat, assuming they'd be pretty far past 200MM. I stand corrected.
Cheers!
Cheers!
You're also forgetting Facebook stories which is a stories feature for the main Facebook app that inserts the stories in a spot right above the newsfeed.
FB have effectively copied the stories feature across all of their media properties (FB/WhatsApp/Instagram). I'd imagine they'll eventually add the ability to cross-post selectively.
FB have effectively copied the stories feature across all of their media properties (FB/WhatsApp/Instagram). I'd imagine they'll eventually add the ability to cross-post selectively.
SNAP will be the best short once it crossed $50B market cap.
What I find really interesting in that number is that according to Matt Levine the IPO has been already oversubscribed 10 times.[0]
This kind of number strongly implies that one can expect the immediate post-IPO valuation to be quite a bit higher. However, once the aggressive stock flippers are done, there's no telling where the stock price finds its equilibrium.
0: https://www.bloomberg.com/view/articles/2017-03-01/snapchat-...
This kind of number strongly implies that one can expect the immediate post-IPO valuation to be quite a bit higher. However, once the aggressive stock flippers are done, there's no telling where the stock price finds its equilibrium.
0: https://www.bloomberg.com/view/articles/2017-03-01/snapchat-...
I don't see that snapchat has the lock-in to make it worth the risk. Sure you can leave other social networks and it's always a risk but Snapchat's ephemeral nature seems to make that risk much much worse. That said I only used it for a week before I got annoyed by it so maybe I don't have the best perspective.
Robinhood has bids starting at $16 on the IPO... I have no clue if it's a smart buy. Anyone care to chime in?
Note that on Robinhood you're only entering a "pre-ipo" bid but are not participating in the ipo -- i.e., you aren't guaranteed that your order will fill at any point
Source: https://support.robinhood.com/hc/en-us/articles/115000902306...
Source: https://support.robinhood.com/hc/en-us/articles/115000902306...
this valuation expert from NYU puts the value at $13.3B (dramatically lower than the stated IPO price)
http://aswathdamodaran.blogspot.com/2017/02/a-snap-story-val...
http://aswathdamodaran.blogspot.com/2017/02/a-snap-story-val...
He's quite often wrong: http://aswathdamodaran.blogspot.com/2012/02/ipo-of-decade-my...
This is far more risky than FB IPO. How high it goes is anybody's guess (outside management team).
Trying to wrap my head around why this is any different than Twitter.
Trying to wrap my head around why this is any different than Twitter.
It's much much closer to a 50/50 gamble than a smart buy: all intra-day trading is, unless you have a quantifiable competitive advantage.
What I don't understand about this is if I'm using Instagram Stories, just because I happen to be an active instagram user....why would I ever switch to Snapchat other than audience? I can get alot of the same audience on Instagram already. Stories does the trick mostly
People my age (22) just use Snapchat to flirt or post pictures of parties. No one - and I mean no one - ever checks out the articles in the Stories section of Snapchat. I really don't see any way for them to make money at this point.
That's a number that makes the $3B Facebook offered them look quite small.
Snapchat is Comcast for your face, without the need for pipes. They want to own the distribution of video content on mobile (and eventually AR), whether it comes from your friend or from NatGeo. Right now, it's hard to get started on Snapchat for small vendors. It makes a lot more sense for large companies. This differentiates its strategy from Google and Facebook in a big way -- it's more demand generation (which FB also serves) than end-of-pipeline marketing. I am not sure how this limitation affects its growth potential. Thoughts? Will they open it up to smaller clients? How will the limitations of the format affect ads?
I'm sure they will open it up more broadly at some point. Right now they can ensure that the big brands create more compelling ads and have control over it. We'll definitely see more portrait video content moving forward.
Do you know if the ads they started running are forced viewing? Are they injected like interstitials before you can digest your friends' content?
If so, that's compelling for an advertiser but likely to kill the service IMO, as young people will easily defect.
Do you know if the ads they started running are forced viewing? Are they injected like interstitials before you can digest your friends' content?
If so, that's compelling for an advertiser but likely to kill the service IMO, as young people will easily defect.
Yes, there are now interstitials. They are not mandatory though -- you can swipe past.
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My take:
The most important thing is the non voting shares. Big money will be staying away from that IPO.
The most important thing is the non voting shares. Big money will be staying away from that IPO.
Completely untrue. The IPO is already 10 times oversubscribed. [0]
[0] http://video.cnbc.com/gallery/?video=3000597530
[0] http://video.cnbc.com/gallery/?video=3000597530
As I say, that was my assessment. I just wanted to be friendly and share my views.
But, people are free to do whatever they want with their money. Just keep in mind that Snap isn't AMD, and snapchat CEO+board inspire opposite of confidence with their public statements. I won't even go into their financial predictions, aspirations and what they plan to do with the money. Just because the capital is oversaturating lately, doesn't mean all IPOs will go up.
But, people are free to do whatever they want with their money. Just keep in mind that Snap isn't AMD, and snapchat CEO+board inspire opposite of confidence with their public statements. I won't even go into their financial predictions, aspirations and what they plan to do with the money. Just because the capital is oversaturating lately, doesn't mean all IPOs will go up.
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I see 0 value in Snapchat. Besides, how is it even being monetized?
Edit: I meant 0 value as in 0 added value. See mrweasel's comment below for more details on the second point.
Edit: I meant 0 value as in 0 added value. See mrweasel's comment below for more details on the second point.
How is Twitter being monetized? Facebook? Uber? Instagram?
Say what you will about valuations in general, but Snapchat is rare in that they've produced a physical product and set some sort of future goal in hardware (specifically cameras). So If everyone else gets a C, I'd at least give them a C+.
Say what you will about valuations in general, but Snapchat is rare in that they've produced a physical product and set some sort of future goal in hardware (specifically cameras). So If everyone else gets a C, I'd at least give them a C+.
Why is Uber in that list? They provide a service to consumers in exchange for money, unlike the rest of your examples and Snapchat.
Uber is Uber because of software. Take it away and you have a cab company that exploits contractors (which based on the history of cab companies is really saying something).
The last Uber I ever took was a 20 minute drive that cost me $3.75 — I had a conversation with my driver about his cut of the fare, and tipped him because I felt guilty about how absurd it had become.
Uber's recent losses are unparalleled and largely stem from driver subsidies because they aren't actually charging a sustainable fare for the service they contract.
I honestly don't think they're a real company. It's all a farce.
The last Uber I ever took was a 20 minute drive that cost me $3.75 — I had a conversation with my driver about his cut of the fare, and tipped him because I felt guilty about how absurd it had become.
Uber's recent losses are unparalleled and largely stem from driver subsidies because they aren't actually charging a sustainable fare for the service they contract.
I honestly don't think they're a real company. It's all a farce.
You don't see value in an engaged audience of nearly 300 million people using a product regularly? Really? Zero? I think that's an incredibly unfair and naive thing to suggest to be honest.
Well maybe not zero, but certainly not anywhere near $24B. There is no clear way of injecting ads into Snapchat, and in many markeds users could just revert back to SMS at no cost, so charging for the service will only work in some markeds. Assuming that engaged users equal profit is more or less the reasoning that brought us the .com bubble.
I won't suggest that that one could'nt turn a profit on Snapchat, but one false step and those 300 million users will leave faster than they came. They've already been taught that Snapchat is a free service, that will be hard to change. And VCs are ready to fund the next Snapchat the minute that the IPO hits, so the users won't have to wait long for their new free alternative.
Snapchat is a fun opportunity, if the price where $10-20 million.
I won't suggest that that one could'nt turn a profit on Snapchat, but one false step and those 300 million users will leave faster than they came. They've already been taught that Snapchat is a free service, that will be hard to change. And VCs are ready to fund the next Snapchat the minute that the IPO hits, so the users won't have to wait long for their new free alternative.
Snapchat is a fun opportunity, if the price where $10-20 million.
Sorry, but this is nonsense. Snapchat already has 2 forms of ads (paid filters and sponsored stories), and $400m in revenue on "only" $450m in costs. Saying SMS will replace snapchat is like saying horses will replace airplanes; anyone under 30 with a smartphone is way past that. For me, only a little older than the main snapchat demographic, it's replaced most of my use of Hangouts (which replaced SMS, but is basically interchangeable with whatsapp/whatever as far as I'm concerned), and completely replaced Facebook. If I used twitter, it probably would have replaced that too. I have several snapchat friends that I literally don't even have their phone number.
Get a few big celebrities using the snapchat glasses courtside at an NBA game or from backstage at a concert or something and watch snapchat explode. I was at a wedding with those glasses and you should have seen how much everyone of all ages loved the glasses.
If their valuation was <$10B I'd be all over this IPO, just $24B seems way too high to me (I also think the whatsapp $19B was ridiculous). Their only risk is being replaced the way I think snapchat will replace Facebook (although I don't think Facebook will completely die), which as the evolution of websites and smartphone apps has shown no one can predict.
Get a few big celebrities using the snapchat glasses courtside at an NBA game or from backstage at a concert or something and watch snapchat explode. I was at a wedding with those glasses and you should have seen how much everyone of all ages loved the glasses.
If their valuation was <$10B I'd be all over this IPO, just $24B seems way too high to me (I also think the whatsapp $19B was ridiculous). Their only risk is being replaced the way I think snapchat will replace Facebook (although I don't think Facebook will completely die), which as the evolution of websites and smartphone apps has shown no one can predict.
Their expenses were over $900m, I don't know where you got $450m from.
You're right, the linked article says "cost of revenue" was $450m which I assumed was a non-technical term by a writer trying to pad the article out, but the S-1 has it all broken out including that. With everything else it was over $900m. The S-1 has it defined as things like their infrastructure costs (bandwidth and such?).
> Well maybe not zero, but certainly not anywhere near $24B.
Sure that's a reasonable opinion, one that I agree with.
> Snapchat is a fun opportunity, if the price where $10-20 million.
This is just out of touch. Show me another platform with the level of reach, engagement and usage that SnapChat has that's worth less than $5B. You realize Snap have generated $400mm in revenue last year right? I think you just have a fundamental misunderstanding of the product, the company, and their place in the market.
> There is no clear way of injecting ads into Snapchat, and in many markeds users could just revert back to SMS at no cost, so charging for the service will only work in some markeds.
There is a very very clear way of injecting ads into SnapChat and that's what they've generated the $400mm in revenue from. In fact, it's the same method that Instagram stories uses - sponsored story ads placed between organic stories amongst other media centric partnerships.
Sure that's a reasonable opinion, one that I agree with.
> Snapchat is a fun opportunity, if the price where $10-20 million.
This is just out of touch. Show me another platform with the level of reach, engagement and usage that SnapChat has that's worth less than $5B. You realize Snap have generated $400mm in revenue last year right? I think you just have a fundamental misunderstanding of the product, the company, and their place in the market.
> There is no clear way of injecting ads into Snapchat, and in many markeds users could just revert back to SMS at no cost, so charging for the service will only work in some markeds.
There is a very very clear way of injecting ads into SnapChat and that's what they've generated the $400mm in revenue from. In fact, it's the same method that Instagram stories uses - sponsored story ads placed between organic stories amongst other media centric partnerships.
network effects and product vision are pretty valuable, maybe not 24B, but certainly way more than 20m
Facebook also IPOd with minimal profits, 300 million users who would never be willing to pay for the service, and hordes of VCs ready to fund their competitors. Snapchats mileage may vary, but facebook now generates lots of ad revenue.
Facebook also IPOd with minimal profits, 300 million users who would never be willing to pay for the service, and hordes of VCs ready to fund their competitors. Snapchats mileage may vary, but facebook now generates lots of ad revenue.
This is exactly what I meant, thank you for putting it so eloquently.
Have you even used Snapchat? News networks and blogs are always keeping up featured spots on the stories tab of the app. It's become an advertising tool.
I would like to see stats on the number of users who actively uses the stories tab, because I doubt it's where the "engaged users" spend their time.
Human attention is a finite and hard to capture resource. Snapchat has a lot of it (its users spend a lot of time looking at the app). Advertisers are willing to pay a lot of money for people's attention.
A lot of people think there will be a big shift in brand advertising away from TV and towards the internet (brand advertising is aimed at general awareness about a brand and forming positive or desirable associations with that brand in people's minds). Snapchat is very well poised to capture a lot of brand advertising money if this shift happens in the next several years. Not only do they have a large, highly-engaged user base, but also brand advertisers are often especially eager to reach younger consumers who are just beginning to form impressions of brands.
Of course, there are a lot of "if"s in all of that. But they do have a clear path to bringing in massive revenue if everything goes well.
A lot of people think there will be a big shift in brand advertising away from TV and towards the internet (brand advertising is aimed at general awareness about a brand and forming positive or desirable associations with that brand in people's minds). Snapchat is very well poised to capture a lot of brand advertising money if this shift happens in the next several years. Not only do they have a large, highly-engaged user base, but also brand advertisers are often especially eager to reach younger consumers who are just beginning to form impressions of brands.
Of course, there are a lot of "if"s in all of that. But they do have a clear path to bringing in massive revenue if everything goes well.
That being said, at Internapalooza this year, the longest line there was for SnapChat and every young person seemed enamored with them. And I remember a time where everyone was screaming that Facebook would fail because of it's lack of profit or that Twitter was the next Facebook/Google.
This is all a long way of saying that no one knows what the hell they are talking about when they discuss these companies. Whether that's posters on HN, financial talking heads, or even successful people in Silicon Valley. If you have some advantage on the market, and can predict the correct valuation of Snapchat, then:
1. Put your money where your mouth is. Buy or short the IPO.
2. It's probably wise to not share your take as it relinquishes the advantage you think you have on the market.
3. Hope you stay solvent longer than the market stays irrational.
Just remember, these same "experts" said that no one needed DropBox when they had wGet.