Ask HN: How much do you think SnapChat is really worth?

https://news.ycombinator.com/item?id=6736704

by bryang • 13 years ago

8 25 13 years ago

news.ycombinator.com

With the gossipy 3 Billion acquisition talk going around, I'm curious to learn what the HN readers believe to be a proper or more logical valuation for SnapChat (which does not have any immediate or pending revenue sources)

davidsmith8900• 13 years ago

- As of now, 0.5 Billi with a potential of around 7 Billi.

krrishd• 13 years ago

Well, that's just silli.

imsofuture2• 13 years ago

I hadn't heard of SnapChat until this acquisition story broke. I guess I'm out of touch or something?

Anyway, no revenue and no real hope of revenue = $0. VC can blow smoke up your ass until they collapse, blue in the face, but it's not a winning proposition.

essersteven• 13 years ago

You are out of touch. For those < 30, SnapChat is one of the most popular social networking apps. It may not be generating revenue now, but there has to be some value in it for the amount of users it currently has.

edit: but yea, I think $3 billion is a little high...

WhiteFoxx3• 13 years ago

Theres a difference between having value to users because its a decent app and they get to use it for free, and generating revenue from those users. Ask those users to pay and they will leave in droves.

shubhamjain• 13 years ago

I am not an investor and have very vague clue of such eccentric valuations but let me get my facts straight. An app which is analogous to a "teen trend", generates no revenue, has a very little or no clue how to either, is worth $3B? Does the brand value and niche matter more than possible potential of company, "money-wise"?

imsofuture2• 13 years ago

To some people! :)

sixQuarks• 13 years ago

At least $29.95

ktran03• 13 years ago

As much as someone's willing to pay.

Personally, it does not surprise that FB is willing to pay 3B. FB is struggling with the younger crowd as of late, it's a great strategic move in my opinion.

bryang2• 13 years ago

"As much as its bought for" is a popular response when I've asked this question. I guess it comes down to sematics - is value sort of like Net Revenue Versus Revenue? Amazon makes boatloads of revenue, but still hasn't seen the return it wants. How does this affect the value of the company? The stock buyers apparently don't care...

I think these sort of app related multi-billion acquisitions with little or no revenue are a complete farce and do more harm than good - especially when it comes down to a product with NO revenue. It's basically disregarding capitalist business principles for shallow popularity.

gesman2• 13 years ago

You mean the cost of the porn side of it?

bryang2• 13 years ago

I've been thinking about making an app called ScreenSnap that takes screen captures every time a naked body appears on the screen... ;)

gesman2• 13 years ago

It'll quickly drain the battery....

davehimself• 13 years ago

I said, "SnapChat! What you want?... He said, 'I need about tree-fitty'"

poseidon• 13 years ago

@BoredElonMusk tweeted "I offered Snapchat zero dollars and am pretty sure I would have overpaid.", source: https://twitter.com/BoredElonMusk/status/400701171272130560

brotchie• 13 years ago

$3bb

Supply-demand. If there's a suitor willing to drop $3bb on Snapchat, then that's the market clearing price is it not?

Given that Snapchat didn't accept, perhaps it's worth a tiny bit more.

misterparker• 13 years ago

when someone rejects the demand, it doesn't mean it's worth more, unless there is someone else willing to offer more. But you're dead on that it's worth whatever someone is willing to pay for it. "worth" is a tricky word. We default to thinking that all things have an intrinsic value, when really nothing does. The value of something is only equal to what someone is willing to do to obtain that something.

People think gold has this intrinsic value, but does not either. It's "natural" value is also soley based upon the demand that is put upon it. The fact that people find it beautiful, and that is a great conductor of electricity, are things that are desired about it. And so the more people that discover the uses of gold, the more demand grows.

If there were no googles, or apples, or yahoos, or any of these huge companies with really deep pockets, then there would be no one to offer $3billion for a company like snapchat, and there would be no way it could ever obtain a "worth" of 3 billion. Because, again - anything is only worth what someone is willing to pay (or do) to obtain it. Even your job.

pathy• 13 years ago

The problem I see with Snapchat is that:

a) currently no revenue, I imagine it is harder to monetize Snapchat than Facebook et al. But it is not my area of expertise so I can give them the benefit of the doubt that they can monetize it.

b) They are one lawsuit away from blowing up. I can see a future where they get hit with a child porn lawsuit or something similar. I assume they have good lawyers but it is still a rather significant risk.

I think it was a mistake not to take one of those billion dollar deals but I have been wrong before. If they can monetize their service and avoid lawsuits it could become huge.

anywherenotes• 13 years ago

I think social media services can grow extremely large, but monetizing turns people off. Facebook is tricky, because the data you post there is available forever, I fully expect to use facebook 30 years from now to look at my kid's pictures (that I take and post now). This is very different from a blurt on twitter or a video designed to disappear in seconds.

I can't imagine these services being worth as much as facebook, and I don't know what they're thinking turning that amount down. They have no revenue.

nicholas73• 13 years ago

It's really just another Instagram purchase. Posting photos is one of FB's core features, so FB is putting out any fires before they can grow. It's like Yahoo buying out Google before it can ... oh wait.

Ask HN: How much do you think SnapChat is really worth?

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