Picture It: Snapchat As A $20 Billion Public Company

Published: November 17, 2016

1snapchatSnapchat has reportedly filed for an initial public offering (IPO), bringing the social messaging app closer to a $20 billion to $25 billion U.S. stock market debut. Reuters, quoting sources familiar with the situation, said the company could go public as soon as March 2017.

If the company does go public at the predicted valuation, it would be the largest U.S. technology IPO since Facebook debuted in 2012 with an $81.2 billion value. Internationally, Alibaba Group Holdings’ public offering two years ago carried an even bigger value: $170.9 billion.

The announcement extends beyond the consumer world to have an impact on B2B marketers, according to a Forrester analyst. “This announcement should matter to B2B marketers, demand generation specialists and sales people alike,” said Mary Shea, Principal Analyst, Forrester Research. “Today, the relevant B2B social channels are LinkedIn and Twitter, and the primary users of Snapchat are Gen Z and Millennials. In the B2B world, we are already seeing the impact of Millennials; they make up one-third of the workforce and — in three years time — they will be half. Gen Y Millennials (27 to 35-year-olds) are increasingly influencing and being tasked with making purchasing decisions for their firms.”

“The real question to ask is if Snapchat will be a vibrant social channel by the time these Gen Zs make their way into the workforce,” she continued. “That is really contingent upon Snapchat’s overall future business strategy and ways they can extend the app/channel’s relevancy for both buyers and sellers in a digital world.”

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Snapchat debuted in 2012 as a free mobile app that allowed users to send photos that vanish within seconds. Approximately 60% of its 100 million active users are aged 13 to 24, making it an attractive platform for advertisers to reach Gen Z buyers.

Shea added, “If you think about the future of B2B social, it’s less about focusing or hedging on one social channel versus another. It is more about engaging with your buyers wherever they are. B2B firms are always evolving and pivoting their strategy, and it is no different with social engagement. B2B marketers must keep their ears to the digital pavement and keep asking the question: ‘Where is my buyer?’ If your buyer is on Snapchat, then you want to be there too.”

Snapchat has had no problems raising venture capital funding to date. The company raised $1.81 billion in May 2016, when it received its $20 billion valuation, according to Reuters.

Posted in: Industry News

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