What Does Future Hold For Snapchat?
According to Techcrunch.com (link below), a recent round of funding has put Snapchat's value at around $20 billion.
According to reports, the mobile messaging service, in which users can quickly exchange pictures and videos that have a limited shelf life, has now raised approximately $1.5 billion in funding over its short existence.
In the past, Facebook has shown a willingness to break open the bank to acquire social messaging and networking companies that are rapidly growing and potentially threatening Facebook's business.
Instagram turned out to be a very, very shrewd acquisition for Facebook, and their purchase of WhatsApp allowed Mark Zuckerberg and Facebook to keep the rapidly growing company under their umbrella.
With Twitter showing stagnating growth, Facebook is not likely to be interested in an acquisition, despite Twitter's cultural ubiqitiousness.
Snapchat, on the other hand, might be a different story. Though the price tag will obviously be quite high, Snapchat is proving to be extremely popular with people who have left Facebook in recent years, namely younger people. If Facebook wants to continue their strategy of acquiring rapidly growing social messaging/networking companies, Snapchat has to be at least be on their radar.
Facebook has a valuation of $337 billion, so they could acquire Snapchat if they wanted to. Whether or not they see Snapchat as a legitimate threat is another question, and this will ultimately decide whether or not there is an acquisition attempt.
Making a move towards going public raises all sorts of issues for Snapchat, namely how they plan on monetizing all of their daily users.
In the end, an acquisition would seemingly make the most sense for the company, though their rapidly growing value is significantly diminishing the number of potential suitors.
Filed under: General Knowledge