Tag Archives: Snapchat

Snapchat raises $3.4 billion in its initial public offering

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Despite experiencing slow user growth and a net loss of $514.6 million in 2016, Snap, the maker of popular messaging app Snapchat, has raised $3.4 billion in its initial public offering at $17 per share, clinching a reported valuation of $24 billion. The company’s stock continued to climb even though it has yet to receive a single “buy” rating from Wall Street analysts. So why is Snapchat so valuable? Goldman Sachs estimate that the company could reach $2 billion in revenue in 2018, with a projected daily average users of 221 million, a 40% growth from 158 million in 2016. The company indicated that they expect the bulk of the revenue to come from advertising as well as from the sales of their new product, the Snapchat Spectacles, which can record snippets of video that are automatically stored to the user’s Snapchat Memories, a feature that saves snaps, stories and locked content.

Snapchat is raising $200 million at approximately $20 billion valuation

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According to TechCrunch, Snapchat is currently raising $200 million in a funding round, which will value the company at around $20 billion. The fundraising is said to be part of the startup’s $175 million Series F and is based on a share price of $30.72 per share. Once completed, this will boost the company’s total funding to around $1.5 billion. While there’s no doubt that Snapchat continues to attract hordes of millennials and advertisers to its platform, the high valuation could make the company too expensive for potential acquirers and further pushes the company to an IPO, which analysts predict will take place in 2017. According to Statista, Snapchat is one of the most popular unicorns in the private market with the potential to unseat Facebook’s dominance in the social media market.

Snapchat acquires Bitstrips

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Last week, Snapchat announced it has acquired Toronto-based Bitstrips for $100 million. Bitstrips is the maker of the popular Bitmoji app, which allows users to create avatars who resemble them by choosing from a range of options. The options include face shapes, skin colours, eye colours, hairstyles and outfits. According to analysts, the acquisition will allow Snapchat to integrate Bitstrips’ technology to its platform. The news of the acquisition briefly caused Snapchat to grab the number one spot in the iTunes App Store.

You can read about the acquisition here.

Snapchat raises $175 Million

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Snapchat has raised $175 million in a Series F funding round from Fidelity Investments, valuing the company at the same $16 billion valuation it received last year. According to Reuters, the flat round indicates investors are becoming cautious of Snapchat’s sustainability. Last year, Fidelity devalued its stake in Snapchat by 25%, but it was marked up again last fall by about 15%. It is still unclear how profitable the company is and the mark down suggests that Snapchat could be overvalued.

You can read about the funding here.