Owner of Snapchat seeks $3bn IPO in big tech market move
- Credit: PA
The company behind Snapchat is making potentially one of the largest tech market moves in recent years.
Snap Inc is seeking up to $3bn (£2.4bn) in an initial public offering (IPO).
The figure could shift based on investor demand, which will also determine the price per share sought by Snap in the coming weeks.
Photo and video sharing app Snapchat has millions of users – up to 158m a day – and Snap has built a thriving business on its success.
However, the company has also seen a substantial loss over the past two years of almost $900m (£719m).
The social network, which allows people to send photos, videos and messages which disappear soon after viewing, was created in 2012 by Evan Spiegel. The Stanford University student dropped out three classes shy of graduation to focus on the app.
Mr Spiegel, 26, is poised to become a multi-billionaire, along with his former fraternity brother at Stanford, Robert Murphy, 28, who is also a company co-founder.
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Each man owns 227m shares of Snap stock, which was valued at $30.72 per share nine months ago when the company raised $700m (£560m) from a group of investors, according to its IPO documents filed on Thursday.
If Snap can fetch the same price in its IPO, Mr Spiegel and Mr Murphy each will be worth $7bn.
The Snapchat story
Over the years Snapchat has shown its versatility in the social network scene. It has added a Discover section – where publishers including People, the Wall Street Journal and Vice post video-heavy stories aimed at millenials – its Stories feature, letting users create a narrative of photos and videos from the past 24 hours, and popular filter feature Lenses.
Snap looks set to adopt a model designed to give final say to the company founders.
It would be similar to set-ups at Facebook, where chief executive Mark Zuckerberg holds all the power, and Google parent Alphabet, where Larry Page and fellow co-founder Sergey Brin can override all other shareholders.