One of the hottest startups in LA’s Silicon Beach right now is SnapChat an app for sharing moments with friends. 50 million snaps are taken every single day and it is now being valued at $800 million dollars based on a recent $80 million dollar raise from Institutional Venture Partners (source – TechCrunch). The startup is based in Venice which is located between Santa Monica and Marina del Rey and they don’t work out of some giant office building, that’s really not very, well, Venice. Instead they work out of this awesome blue beach house:
Another $80M brings Snapchat’s total funding up to $96 million dollars and with an $880 million dollar valuation the and money in the bank everyone is wondering what will Snapchat do next? For app makers with such rapid user growth reaching new audiences is critical, investors want to see more users coming on every single month.
I’ve heard lots of comments about how Snapchat is insanely over-valued since they are worth close to a billion dollars but are yet to have any defined and sustainable revenue model. Still, it’s 2013 and active engaged users are gold, and as most people know it’s not as simple as building an app and hoping people will use it, getting traction like Snapchat has seen is a one in a million scenario.
Go ahead, search the app store and you’ll find plenty of apps that people use to share content on every day. Some have thousands of people sharing at once, but very few have the same amount of user activity as Snapchat, Instagram, Twitter, Facebook and the few others that you all know, but might not all use personally. It’s always easy to look at a situation and say, “anyone can do that,” nothing could be further from the truth.
I think Snapchat is absolutely rocking it, they’re building a great company and millions of people around the world are using and enjoying it. As always I’d love to hear from you, what do you think about Snapchat’s $880 million dollar valuation?