20 Crazy New Things We Learned About Snap
The maker of Snapchat, expected to be valued at more than $20 billion, revealed its inner workings for its IPO.
After months of speculation, Snap Inc. filed yesterday for a $3 million IPO on the New York Stock Exchange. When the company officially goes public in March, it is expected to be valued at more than $20 billion.
Founded in 2011, the maker of messaging app Snapchat and Spectacles (sunglasses that record video), is known for being pretty opaque in its business dealings.
But this move now requires the previously mysterious company to submit financial details and its plans for the future with the U.S. Securities and Exchange Commission, so that potential shareholders have the information they need to make decisions about the company's stock.
Read on for the 20 facts we learned about Snap from its SEC filing.Related: 5 Facts About Evan Spiegel, Snapchat's Often Controversial Co-Founder
The company's ghostly logo makes a lot more sense given Snapchat's original name. In 2011, the app was named Picaboo.
The first advertisement on the platform was for the film Ouija in 2015.
An average of 158 million people use Snapchat every day.
More than 2.5 billion Snaps are created daily.
Users spend an average of 25 to 30 minutes on Snapchat every day.
All of the company's revenue comes from advertising.
At the end of 2016, Snap had revenues of $404.5 million but the company had a net loss of $514.6 million.
While Snapchat is wildly popular today, founders Evan Spiegel and Bobby Murphy admit that they "anticipate that the growth rate of our user base will decline over time."
Spiegel wants to influence the future of Snap even if he is no longer with the company. The SEC filing specified that "if Mr. Spiegel's or Mr. Murphy's employment with us is terminated, they will continue to have the ability to exercise the same significant voting power and potentially control the outcome of all matters submitted to our stockholders for approval."
The company uses Google Cloud to store company information. Spiegel and Murphy say that since so much of the company infrastructure is supported by Google, it could affect potentially expanding into China because of how the country restricts access to it.
Snap views Apple, Facebook -- including Instagram and WhatsApp -- Google, Kakao, Line, Tencent and Twitter as its chief competitors.
As of December 2016, Snap has 1,859 employees.
Spiegel earns a salary that is twice that of Murphy's -- $500,000 compared to $250,000
Third co-founder Reggie Brown filed lawsuit in 2013 that claimed he was pushed out of the company. In 2014, Brown received $157.5 million in a settlement.
Spectacles had to meet FDA regulations and the filing says Murphy and Spiegel expect that "We may develop future products that are regulated as medical devices by the FDA."
Snap doesn't have a dedicated main headquarters, but offices in several different cities. The co-founders say in the filing that this structure could make it more difficult to encourage "positive employee morale" and "adequately oversee employees and business functions."
Even though it launched in California, Snap is incorporated in Delaware.
The company doesn't plan to pay stockholders any cash dividends.
Snap defines a Daily Active User as someone who has an account on the platform and opens up the app at least once during a 24-hour period.
Ahead of the IPO filing, the company launched the Snap Foundation, a charitable arm of the company to support youth arts and education.