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I just can't take seriously any VC valuing this company at $10 billion, and I'd be furious about this if I had money invested with any of the firms involved. A

I just can't take seriously any VC valuing this company at $10 billion, and I'd be furious about this if I had money invested with any of the firms involved. According to Forbes[1] they have 100 million users. That seems high, but even if that's the case...since when is an app worth $100/user? Even Whatsapp didn't get that on a per-user basis. [1] http://www.forbes.com/sites/parmyolson/2014/08/26/report-snapchat-valued-at-10-billion-with-new-kleiner-investment/ http://www.forbes.com/sites/parmyolson/2014/08/26/report-sna...

deleted 12y ago
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- rdl 12y ago
  Plus they probably have preference
imjk 12y ago
I think most people who invest in these things take future/potential growth into account. Also, it can be argued that consumer web investments have been working on the greater fool theory for the past decade: http://en.wikipedia.org/wiki/Greater_fool_theory http://en.wikipedia.org/wiki/Greater_fool_theory. This is still relatively early for comparable hyper-growth consumer web or mobile consumer app company. If you're able to get your money in this round, you're likely going to see a good return. Not saying I necessarily agree with the investment, but this is just how things have been lately.
danielpal 12y ago
Right, I know how you feel. This is how the Digital Sky Technologies LP's must feel about them investing in FB at 15B...good for you that you weren't part of that fund - they are definitely not serious VC's.
- downandout 12y ago
  Are you actually trying to imply that Snapchat is the next Facebook?
  - danielpal 12y ago
    I am saying that valuing a company at a value $10B or $100B it's not outrageous in any way. You said you cannot take seriously any VC that values a company above $10B implying that no company can go above $10B or that they are somehow insane to think that could happen. This is simply no outrageous in any way and it was likely a very competed investment - I do think that Snapchat can achieve a value much larger than $10B or even $20B. Outrageous I would say is $1 trillion.
    - downandout 12y ago
      >"You said you cannot take seriously any VC that values a company above $10B implying that no company can go above $10B or that they are somehow insane to think that could happen." I said nothing of the sort. I said that Snapchat is not worth $10 billion and likely never will be. For reference, my exact words were: "I just can't take seriously any VC valuing this company at $10 billion"
prostoalex 12y ago
They don't. They invest with liquidation preferences and hidden dividends payable at liquidity. It's the press that assumes that preferred stock == common stock.

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rdl 12y ago
Plus they probably have preference

imjk 12y ago

I think most people who invest in these things take future/potential growth into account. Also, it can be argued that consumer web investments have been working on the greater fool theory for the past decade: http://en.wikipedia.org/wiki/Greater_fool_theory http://en.wikipedia.org/wiki/Greater_fool_theory. This is still relatively early for comparable hyper-growth consumer web or mobile consumer app company. If you're able to get your money in this round, you're likely going to see a good return. Not saying I necessarily agree with the investment, but this is just how things have been lately.

danielpal 12y ago

Right, I know how you feel. This is how the Digital Sky Technologies LP's must feel about them investing in FB at 15B...good for you that you weren't part of that fund - they are definitely not serious VC's.

downandout 12y ago
Are you actually trying to imply that Snapchat is the next Facebook?
- danielpal 12y ago
  I am saying that valuing a company at a value $10B or $100B it's not outrageous in any way. You said you cannot take seriously any VC that values a company above $10B implying that no company can go above $10B or that they are somehow insane to think that could happen. This is simply no outrageous in any way and it was likely a very competed investment - I do think that Snapchat can achieve a value much larger than $10B or even $20B. Outrageous I would say is $1 trillion.
  - downandout 12y ago
    >"You said you cannot take seriously any VC that values a company above $10B implying that no company can go above $10B or that they are somehow insane to think that could happen." I said nothing of the sort. I said that Snapchat is not worth $10 billion and likely never will be. For reference, my exact words were: "I just can't take seriously any VC valuing this company at $10 billion"

prostoalex 12y ago

They don't. They invest with liquidation preferences and hidden dividends payable at liquidity. It's the press that assumes that preferred stock == common stock.