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Snapchat is Intrinsically Worthless

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Re: Snapchat is Intrinsically Worthless

#61

Post by FailMore »

I think Snapchat are crazy if they don't put ads in there soon.

I see Snapchat as a faster Youtube. It's basically content that you want to see - Youtube from the masses, Snapchat from your friends.

The Youtube advertising model is clearly fantastic. From things I've read some time in the past I know they kill it on a $/user basis vs pretty much every social site on the web.

Putting a 2 second static 'brand flash' in front of every snap would probably not put people off using the service (in the same way that people still use Youtube - even though video hosting is a highly replicable thing). And from a brands point of view 2 seconds is probably all you need to get into someone's subconscious.

Bonuses for being an app:

1) Full screen take over. 2) No distractions from other tabs. 3) I'm sure they could find out age and sex quite easily if they wanted to. So they would have - age, sex and location. POWERFUL.

The sooner the better. Explain that the app needs to make money to it's users. People get used to things.

Re: Snapchat is Intrinsically Worthless

#62

Post by dpcheng2003 »

cromwellian wrote: post #47

I thought I was taking crazy pills when Zynga got valued more than Electronic Arts. Yeah, a company with games that practically aren't even games which makes money via spammy offers, is worth more than a multi-decade-old company with a gigantic catalog of games, which people actually pay cash for, spread out over every continent and every console, handheld, and PC. When I saw that story, I was like "do any of the jou…

It turns out smart people do dumb things all the time. The trick isn't being smart all the time, which is difficult.

Rather, you want to be smart at the right time and convince other incredibly smart people to do something incredibly dumb in that fleeting moment.

Last I checked, most of us have never created a messaging app that grew to 350M messages in two years. More importantly, most of us didn't also then convince smart investors to let us cash out at some ridiculous valuation.

Props to the Snapchat guys and I hope they figure out monetization but at the end of the day, they got their FU money and built something huge. That's a win in my book.

Re: Snapchat is Intrinsically Worthless

#63

Post by dakrisht »

cromwellian wrote: post #47

I thought I was taking crazy pills when Zynga got valued more than Electronic Arts. Yeah, a company with games that practically aren't even games which makes money via spammy offers, is worth more than a multi-decade-old company with a gigantic catalog of games, which people actually pay cash for, spread out over every continent and every console, handheld, and PC. When I saw that story, I was like "do any of the jou…

Zynga was/is just a glorified spamming enterprise built atop Facebook's platform to get cheap and massive volumes of traffic. They've never created anything even remotely original (have basically ripped every single Maxis title since Sim Farm) and their ex-CEO was/is a complete scumbag who defrauded the public markets and early employees from everything under the sun.

SnapChat isn't much different. Just another "trendy app" that VC's love to throw money at since their partners invested in a previous competitors.

Re: Snapchat is Intrinsically Worthless

#64

Post by dingaling »

ubi wrote: post #52
yoloswag wrote: post #26

Earlier quoted context omitted.

My jailbroken iPhone saves every snapchat that I get without notifying the other party. It also makes all snaps viewable for unlimited time and I can even send snaps of pictures in my camera roll to make it seem as if I took the picture in the moment. Look up "Phantom". It's a jailbreak tweak for iOS available in Cydia.

Trust matters.

An interesting statement, given that the problem that Snapchat addresses is that its users don't trust each other.

Otherwise they could send their embarrassing pictures by plain old e-mail with a request 'please do not forward'.

Instead they place proxy-trust in Snapchat to enforce that restriction; if that trust falters, so does Snapchat.

Re: Snapchat is Intrinsically Worthless

#65

Post by [deleted] »

harryh wrote: post #24
richardv wrote: post #18

Am I missing something but I always assumed that valuations at this stage of a company is to do with huge/vast sums of money being removed from the table by the founders and they've done this by selling a good stake of their equity/voting rights in their company. The founders are now rich.. but the company isn't.. and if they raise a next round, their true valuation will shine through...

Anytime stock changes hands in exchange for money it's reasonable to use that transaction to value the company. It doesn't matter if it's the company selling a piece of itself or employees selling stock to an investor. Someone is still paying money for ownership. If anything, employees selling shares probably makes it easier because it's common instead of preferred shares being sold.

[deleted]

Re: Snapchat is Intrinsically Worthless

#66

Post by dakrisht »

cylinder wrote: post #56

Imagine a beach. People come to the beach, play, build sand castles they later destroy. It's one beach on a long stretch of coastline. But this particular beach is incredibly popular, where lots of young people go to hang out with each other. How much would you pay to own that beach? How would you justify that investment -- would you plan to charge an admission fee? Would you wrap the beach in ads and sponsors? Would…

Yeah, and then all of the sudden it starts raining and the kids flock to another beach with a newer DJ and fresh faces.

End game.

Re: Snapchat is Intrinsically Worthless

#67

Post by nashequilibrium »

cromwellian wrote: post #47

I thought I was taking crazy pills when Zynga got valued more than Electronic Arts. Yeah, a company with games that practically aren't even games which makes money via spammy offers, is worth more than a multi-decade-old company with a gigantic catalog of games, which people actually pay cash for, spread out over every continent and every console, handheld, and PC. When I saw that story, I was like "do any of the jou…

Well, even the Zuckerberg family is into the concept!http://www.wired.com/opinion/2013/11/randi-zuckerberg-on-des...

Re: Snapchat is Intrinsically Worthless

#68

Post by tg3 »

cylinder wrote: post #56

Imagine a beach. People come to the beach, play, build sand castles they later destroy. It's one beach on a long stretch of coastline. But this particular beach is incredibly popular, where lots of young people go to hang out with each other. How much would you pay to own that beach? How would you justify that investment -- would you plan to charge an admission fee? Would you wrap the beach in ads and sponsors? Would…

That's actually a really interesting analogy. I'm sure it's incomplete, but it instructs analysis.

Ownership of the beach is clearly valuable, even if it's unclear exactly how you will extract that value. And beach popularity can be subject to trends and other outside factors.

It's also easy to ruin a beach, and therefore its value by too aggressively trying to get the value out of it. For instance, I'd rather keep the beach free of ads and aggressive tourist sales people to make my money on hotels, condos, and restaurants near to the beach.

I'd say the biggest problem with the analogy is that only part of a beach's value is derived from the other beachgoers - there is some intrinsic value to the combination of sand, sun, and waves. For snapchat, if there are no other users, there is no value at all.

Re: Snapchat is Intrinsically Worthless

#69

Post by [deleted] »

FailMore wrote: post #60

I think Snapchat are crazy if they don't put ads in there soon. I see Snapchat as a faster Youtube. It's basically content that you want to see - Youtube from the masses, Snapchat from your friends. The Youtube advertising model is clearly fantastic. From things I've read some time in the past I know they kill it on a $/user basis vs pretty much every social site on the web. Putting a 2 second static 'brand flash' in…

[deleted]
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