In the largest tech IPO since Alibaba went public in 2014, Snap, the parent company of the immensely popular Snapchat app, will price its offering at $17 per share with a $24 billion valuation.
The company looks to make a tidy profit, announcing that it would sell around 200 million shares, for a total take of about $3.4 billion. Co-founders Evan Spiegel and Bobby Murphy will cash out a combined 32 million shares, netting them each a sum of $272 million. They will retain just under 211 million shares, giving them 88% voting power between them. The remainder of the $3.4 billion that’s being offloaded will be divided among other executives and early investors.
Similarly to Twitter, Snap wasn’t able to turn a profit on its Snapchat app before going public. Moreover, the company’s leadership has stated that it projects its losses to continue to grow going forward. However, in terms of popularity, Snapchat has already surpassed Twitter with 450 million daily users. The company is also beginning to move forward with other products, such as Spectacles — a pair of sunglasses with a built-in camera that streams 10-second video clips to the Snapchat account on your phone.
Stranger still, is that the company is asking a lot of faith from potential investors: the IPO will only be offering non-voting shares, meaning Spiegel and his leadership will be in complete control of the company’s future and direction. Even so, as indicated by the size of the valuation, the company is expecting a lot of investor enthusiasm.
Snap shares will begin trading on the New York Stock Exchange Thursday, March 2nd, under the ticker SNAP.