Snapchat considering listing on US bourses in March’17

Snapchat, the popular messaging application which is a sensation among teens, is expected to get listed on New York Stock Exchange in March’17. The company, Snap Inc., owner of Snapchat application, announced its intentions only recently, and is expected to be listed with a valuation of $3 billion. With the current deal dynamics, the shares which will be with general public will have no voting rights, and the two founders Evan Spiegel and Robert Murphy are expected to maintain considerable control over the firm.

Snapchat is a relatively younger startup dating back to 2011, and had made a niche among the younger generation. However, financially the company hasn’t turned profitable yet, and is not expected to do so in near future. It reported $514.6 million of net losses during 2016, ~40% y-o-y rise compared to $372 million in 2015. However, the firm is banking on the fact that its users grew by ~50% to 158 million in Dec’16, and will continue the growth trend in future also.

With no profits and minimal revenues on the books as of 2016 end, it will be an interesting IPO in the US history. Prior to this, Facebook, a social media behemoth, got listed on US stock exchange in 2012 with a valuation of $104 billion. Initially, the company took some beating and the investors lost a considerable amount of money after the IPO, however, the share of the firm has stabilized since then. One thing or another, the Snapchat IPO will create new paradigm in the social media IPO sector due to its unique and un-parallel characteristics.