Snapchat back hands Facebook

[Dick Whitman]

Facebook offered the message-sharing app $3 billion, and its founders turned it down. That's pretty gutsy.

http://www.usatoday.com/story/tech/2013/11/13/report-facebook-offered-snapchat-3-billion/3517929/

That's pretty bad news for Facebook, which is struggling to attract younger users. Essentially, as I understand it, the pendulum has swung back somewhat. Young people don't want to overshare any more, particularly publicly. They want privacy, and Snapchat, which started out as basically a sexting app, supplies that.

 

[YankeeFan]

I'd like to know what percentage the founder still holds.

I can understand turning down initial offers, but Ho-Lee-Fuk, I hope he doesn't wait too long. We're talking about billions of dollars. That's **** you money for generations.

And, of the various platforms, Snapchat seems like the one that could most easily be rendered irrelevant.

 

[cranberry]

Yeah, according to the NYT, the strategy is being driven by Benchmark Capital, which holds a big venture stake. Apparently, Benchmark also had a big stake in Instagram and was convinced the founders left money on the table when it sold to Facebook for $1 billion.

http://www.nytimes.com/2013/11/14/technology/rejecting-billions-snapchat-expects-a-better-offer.html?hp&_r=0

 

[Dick Whitman]

The NYT story mentions that Facebook turned down some offers early on. I wonder how much and from who.

EDIT: Looks like Viacom made three separate offers at as much as $1.5 billion, and Yahoo! made a $1 billion offer, as well. Microsoft also tried to buy the company or at least a large chunk of it, based upon a $15 billion valuation, and ended up buying a stake for around $250 million.

 

[Mizzougrad96]

The NYT story mentions that Facebook turned down some offers early on. I wonder how much and from who.

I thought Yahoo! offered them a ****load at one point.

 

[YankeeFan]

I think it's probably true that Instagram could have gotten more if they held out longer, so it makes sense for Benchmark to not want to jump at the first deal.

But, if I was a 20-something kid, with this kind of offer on the table, I wouldn't be able to sleep.

 

[Dick Whitman]

The NYT story mentions that Facebook turned down some offers early on. I wonder how much and from who.

I thought Yahoo! offered them a ****load at one point.

Yep. Good memory. I dug that up and edited the post.

 

[Mizzougrad96]

I've never heard of Snapchat, but that doesn't mean anything because I'm old...

I don't know if it's a good move or not, not to sell, but there are a lot more stories about places that should have sold whose companies went from being worth billions to being almost obsolete in very short periods of time.

 

[Mizzougrad96]

Does anyone here have a snapchat account?

 

[YankeeFan]

Snapchat is what you're supposed to use for sending **** pics, right?

 

[cranberry]

Snapchat is what you're supposed to use for sending **** pics, right?

Yep, it started as a hookup tool for kids. The disappearing message is the attraction.

 

[MisterCreosote]

I've never heard of snapchat until now. I'm also old, though.

I don't know if it's a good move or not, not to sell, but there are a lot more stories about places that should have sold whose companies went from being worth billions to being almost obsolete in very short periods of time.

My favorite is News Corp. buying Myspace for $580 million, and six years later flipping it for just $35 million.

 

[YankeeFan]

Teenagers are awesome.

But it was in schools where it did take off early in 2012, with teenagers rapidly learning that it was better than social networks for talking to friends without the whole world prying in. That pattern has led to two common assumptions about Snapchat - that its prime use is for "sexting", the sending of explicit pictures between teenagers, and that it poses a major threat to Facebook.

Evan Spiegel shows he is already the practised diplomat in dealing with both issues. "It is really easy to jump to that conclusion" he says about sexting, while the data suggests that Snapchat is being used all day, in a wide variety of contexts, and much of the traffic is between women users.

http://www.bbc.co.uk/news/technology-24925932

 

[Dick Whitman]

This industry just fascinates me. None of these companies turn a profit. None of them. Even Amazon. It seems like a huge, huge bubble to me, but smart financial people keep throwing money at them. And Facebook's stock keeps soaring.

 

[Dick Whitman]

I wonder if Snapchat is used as a digital clutter-clearing device as much as anything else, even moreso than the privacy aspect.

 

[cranberry]

There's tens of billions of tech dollars chasing a young demographic that doesn't stop long enough to catch before it's on to the next best thing. Amusing to watch, really.

 

[dreunc1542]

This seems like an extremely dumb by Snapchat. I'm not really sure how it can grow much. I wonder if Facebook's looking into buying Tinder to move into the online "dating" realm.

 

[Dick Whitman]

This seems like an extremely dumb by Snapchat. I'm not really sure how it can grow much. I wonder if Facebook's looking into buying Tinder to move into the online "dating" realm.

The story noted that they don't want to work for Zuckerberg. I wonder if Google or someone came along with the same offer, if they would take it.

 

[Michael_ Gee]

The theory on Wall Street is that each new popular social media site will become an Internet advertising cash cow. Alas, whenever a site becomes too full of advertising or corporate shilling, many people, not just kids, stop using it and move on to something else. Maybe these guys are making a huge mistake, but hell, it's their company. Being offered billions doesn't HURT your belief you make said company even bigger on your own.

 

[LongTimeListener]

You know who would be all up on Snapchat?

freqposter.