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Snap Jumps in Debut After App Maker Raises $3.4B in IPO

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Re: Snap Jumps in Debut After App Maker Raises $3.4B in IPO

#81

Post by dmoy »

chollida1 wrote: post #68
gregshap wrote: post #52

Earlier quoted context omitted.

GAAP vs non GAAP accounting refers to how you calculate PnL, not whether you use things unrelated to accounting to hint that you are growing and might make money in the future. You can definitely use strict GAAP accounting and also brag that users are super duper engaged.

I think you are being more than a bit pedantic for very little benefit. I never said "Non Gaap accounting", I said "Non Gaap measures". That doesn't have to mean Pnl, it can, and was intended, to mean things like user engagement numbers, monthly uniques, etc. Is there a different terminology that you would prefer that I use? how about this........ I'm interested in seeing whether they focus on their earnings vs user…

I for one appreciated Greg's note and your follow-up. When you said non gaap initially I thought you explicitly meant the non gaap but still accounting systems that a large, large number of companies out on quarterly earnings (they'll do it right next to it, say " gaap X, non gaap Y ".

So you may see it as pedantic, but I think it was a useful clarification.

Re: Snap Jumps in Debut After App Maker Raises $3.4B in IPO

#82

Post by ryanmerket »

joshuamorton wrote: post #51
ryanmerket wrote: post #14

Earlier quoted context omitted.

>> But companies with such big daily active audience that can be targeted with ads are here to stay. That's just it. Snapchat has very little targeting data, and targeting is a force multiplier for ads revenue. They don't even have explicit gender data. Edit: Downvote all you want. They don't ask the users for gender. It's implied. See Twitter for a similar tactic.

They have extremely powerful targeting data: geolocation. Afaik, one of snap's biggest revenue sources is geolocked filters.

How is that powerful? Any mobile app has geolocation data. How is that a market differentiator? That's like saying they have mobile OS targeting... So?

Re: Snap Jumps in Debut After App Maker Raises $3.4B in IPO

#83

Post by joshuamorton »

r00fus wrote: post #64
joshuamorton wrote: post #50

Earlier quoted context omitted.

Right but I think that most people have used a bank, telphony company, or prescription drugs in the past. OTOH, depending on how loosely or tightly you define what snapchat is ("ephemeral image communication platform", "image communication platform", "communication platform", "social media", "news aggregator"), there are huge groups of people that have never used snapchat or any competing products. There are lots of…

Have you not used any social media?

(note I'm not the original commenter).

I currently have fb messenger, snapchat, groupme, and twitter on my phone. I mainly use the first 2. I've never used whatsapp or instagram at all.

Re: Snap Jumps in Debut After App Maker Raises $3.4B in IPO

#84

Post by probe »

The SNAP thesis I like the best is - "Twitter-like growth with FB ARPU".

The monetization potential of this company is massive (geofilters, sponsored content, hardware with spectacles, etc.) and there's no direct comp for that. Pokemon Go showed us the bleeding of digital to physical, and Snap has the potential to be the first company to unlock value from it (ex. geofilters). Plus you can view SNAP as a call option on AR and their potential to be the main camera (when something exciting happens, which app do you open first? For at least in my social circle its by far Snapchat not the Camera app/twitter/etc).

That being said, they face a massive threat from Instagram Stories and now WhatsApp Stories. Though a caveat - while their DAU growth has slowed, it's actually been in international markets primarily (and I think wrongly they don't care enough about dealing with low-bandwith, "unexciting" users). If they can keep a healthy growth in US to escape the FB threat they can afford to lose internationally.

Their first 1-2 earning report will be very revealing for SNAP b/c the expectations have been set and I'm looking for them to do the following: 1) Raise ARPU at similar rates 2) Maintain healthy DAU growth in the US 3) Create new product innovation around AR/Spectacles/Lenses.

If they don't hit at least one of those goals (and preferably two or all three), than I would be very concerned for them.

Re: Snap Jumps in Debut After App Maker Raises $3.4B in IPO

#85

Post by pm90 »

chollida1 wrote: post #13

I'm happy for the NYSE that this went well. SNAP has done some pretty large volume so far with no problems. Interestingly enough, well atleast to someone who cares about the cash equity markets, the NYSE actually did a test run last week to try and simulate the chaos that occurs during any hot IPO. So now we know that there is atleast some appetite for shares with no controlling interest and no indication of paying o…

> So now we know that there is atleast some appetite for shares with no controlling interest and no indication of paying out a dividend any time soon. A current market cap of 30 Billion is a pretty darn big accomplishment!

This is really disturbing. I don't know if its an indicator of too much money in the market, or just the fact that the market itself has expanded so much. Why would investors be OK with losing power?

Re: Snap Jumps in Debut After App Maker Raises $3.4B in IPO

#86

Post by toast0 »

jonknee wrote: post #21
maxerickson wrote: post #10

Earlier quoted context omitted.

Facebook's market debut showed that Facebook did an excellent job controlling and pricing the IPO. Banks complaining -> Facebook and insiders won. This debut just shows that Snapchat wasn't in the driver's seat. Major holders are still mega wealthy though.

No, it was a disaster that led to years of litigation. NASDAQ admitted it was their technical error and paid millions to settle lawsuits stemming from it. This obsession by techies that you're leaving money on the table if your shares go up after an IPO is bizarre.

> This obsession by techies that you're leaving money on the table if your shares go up after an IPO is bizarre.

If the company gets $X/share at the beginning of the day, and bankers get $X * 1.5/share at the end of the day, that feels like a big donation to Wall Street. If I'm an investor, I'd rather the company have all the capital than 2/3rds of the capital as well. It feels like if a company would sell a portion of the offering through the traditional channels, and the remainder at market prices throughout the first couple days of trading, it might better capture investment.

Re: Snap Jumps in Debut After App Maker Raises $3.4B in IPO

#87

Post by moolcool »

jmathai wrote: post #70
godzillabrennus wrote: post #39

Earlier quoted context omitted.

You are definitely not alone. The Snap product has been geared toward younger people as Facebook once positioned itself. Investors are betting that once the product and audience mature there will be huge payouts like they saw with Facebook. There is a big risk here though. Twitter has crashed and burned when compared to Facebook.

I think it's worth noting that Twitter essentially lost to Facebook. Facebook's dominance pigeonholed and limited what Twitter could evolve to. And I'm not sure there's room for more than a couple social networks. I don't see who SnapChat will lose to besides themselves (i.e. monetization). IMO Facebook/Instagram isn't well positioned win today's 13-25 demographic. The point is, someone will win. And right now I'm no…

I see Facebook as the email of this generation. It's not exciting, it doesn't change a whole lot, and virtually everybody has it. I think we're just seeing a lot of novelty, flash in the pan apps coming and going while Facebook maintains it's boring yet stable position.

Re: Snap Jumps in Debut After App Maker Raises $3.4B in IPO

#88

Post by leesalminen »

elsewhen wrote: post #43
linuxkerneldev wrote: post #34

This $27.8 billion dollar valuation tells me that somewhere along the line, my job and lifestyle have caused me to detach from a significant chunk of society. I've never used Snap or their platform. I don't even really know what the benefit of their service. I am curious if I'm in the minority or if there's lots of developers like me who aren't able to comprehend these valuations.

the fact that you havent used snap doesnt really speak to their valuation. here are some large cap (+$200B) U.S. companies that i have never used: jpmorgan chase, wells fargo, at&t, bank of america, pfizer, verizon.

You've never taken a drug manufactured or discovered by Pfizer? That seems unlikely.

Re: Snap Jumps in Debut After App Maker Raises $3.4B in IPO

#90

Post by Stanleyc23 »

doc_holliday wrote: post #3

I know that the Snapchat platform is worth something, it has high engagement and adoption of 18-24 year old age segment, and that is worth a lot in terms of attention and advertising $s. However, this just feels completely out of proportion to earnings and downside does not seem priced in. Willing to be proved wrong of course, but especially seeing as they are non voting shares, I cannot understand this pricing.

for the majority of would-be shareholders is non-voting shares really that big of a problem, genuinely curious? Even if the votes:shares were 1:1 wouldn't you need a huge percentage (like > 10%) to be an influencer? If I as an 'average Joe' were to personally put down a comparatively minuscule $25k on SNAP would those votes count for much when push comes to shove?
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