Reuters reported this Tuesday Snap Inc. had filed for an initial public offering (IPO) last November 8, on the eve of the U.S. presidential elections. The company could go public as soon as March 2017 valued at an estimated $25 billion.
The report from the news agency cites sources “familiar with the situation,” and Snap Inc has made no comments about the alleged confidential filing.
Rumors about the company going public started getting stronger last month.Snap Inc is living a great moment, and it is, perhaps, getting too big.
The Snapchat app is currently one of the undisputed kings of social media, with over 100 million monthly active users and a growing ad revenue stream.
Snap’s launch of the Spectacles camera-glasses last week was also hit and people are now wondering about new creative ways in which they can use them. The $129.99 gadget has become a rare item, and it goes for much more on sites like Ebay.
What makes Snap’s IPO special?
To put it simply, an IPO by Snap Inc in the trade market could easily result in the biggest offering of its kind in recent years. The economy would largely feel its effects, and the current valuation of the company may even go up before it goes live.
The tech market had not seen an offering this substantial since 2012 when Facebook went public at a valuation exceeding the $81 billion mark. Snapchat famously turned down a $3 billion buyout offer from Facebook three years ago.
At its current $25 billion market value, Snap Inc’s public debut would be the largest since the Chinese IPO giant Alibaba offered its stock shares back in 2014. The Asian company then held a valuation close to $171 billion.
What does Snap’s IPO mean for the industry and its competitors?
For Snap Inc, going public is a surefire way to continue growing at the everlasting expense of ambitious investors. Those interested in putting some money in the camera company will propel and benefit from all of its future ventures.
For the industry, it is a good thing since it would give a much-needed boost to a recently stale market.
Keen-eyed investors and tech experts have been waiting for an announcement like this for some time, particularly after seeing average to poor turnouts in the market with the latest companies that went public.
For competitors like Twitter and Facebook, this is not exactly good. Snap Inc’s impressive growth continues and drives attention away from an already-struggling Twitter, and from Facebook that has a hard time keeping the pace with its own growth.
Snap Inc could diversify even further following its IPO in early 2017, consolidating then its new brand as a camera company instead of just another social media giant.
The market waits eager for the official announcement of Snap’s offering, while also keeping an eye on tech powerhouses yet to go public like Uber Technologies and Airbnb.
Source: Reuters