YOU WON'T BELIEVE HOW MUCH SNAPCHAT IS WORTH
Apr 01, 2015
We’ve reached an era where tech businesses are making their way into the world’s top valued brands – Apple, Microsoft and Google currently hold the top three spots, and even Facebook makes the top 20.
You may not find this surprising, given how much we all use our PCs, macs, laptops, tablets, smartphones, and dare I say smart watches, nowadays. But what about the start-ups? The brands which seem to not be making much revenue or profit? Some are being valued in their billions, thanks to formal funding.
Pinterest for example, which just celebrated its 5th birthday, is valued at $11bn (£7.4bn) – that’s $2bn more than Starbucks and about £1bn more than Sainsburys. The site gives its users a source of inspiration, and it gives brands a fantastic opportunity for direct marketing. With this business model, we can see its potential for revenue in the near future, particularly through advertising and a possible “Buy Now” button the site is developing.
However, the one start up valuation that we can’t seem to get our head around is Snapchat. Popular amongst teenagers and young adults, the app offers an instant messaging service where nothing is stored on a database, although users can take a screen grab of their posts to save them.
Snapchat has recently been valued at $15bn – more than Marks and Spencer, Ladbrokes and Wetherspoons put together. Companies including China’s Alibaba are investing millions in the American start-up, perhaps because of its 100 million daily active users, most of whom are young, impressionable and likely to spend money with the brand in the future.
However, although Snapchat is currently the most popular social media platform among young people, how long will it stay that way? First, there was Friendster, then there was MySpace, and then Facebook took over. Instagram took its place temporarily, but when Facebook purchased Instagram it made sense for teenagers to move on to something else. But how long until Snapchat is overshadowed by something else, and how much will it be worth then?
We’d love to know what you think about how much Snapchat is worth. Do you think it will keep gaining leverage, or will it soon be eclipsed by another social media start-up?