News & Information for Technology Purchasers NewsFactor Sites:       NewsFactor.com     Enterprise Security Today     CRM Daily     Business Report     Sci-Tech Today  
   
Home Enterprise I.T. Cloud Computing Applications Hardware More Topics...
GET RECOGNIZED
Let an ISACA® certification elevate your career.
Register today and save
You are here: Home / World Wide Web / Snapchat Spurns Facebook's $3B
Gartner's #1 for endpoint backup
Will Snapchat Survive Without Facebook's $3B?
Will Snapchat Survive Without Facebook's $3B?
By Jennifer LeClaire / NewsFactor Network Like this on Facebook Tweet this Link thison Linkedin Link this on Google Plus
PUBLISHED:
NOVEMBER
14
2013



Remember the Internet bubble when venture capitalists were throwing cash against online startup walls to see what would stick? Apparently, Snapchat remembers those days and is holding out for a big payday.

But will Snapchat, the mobile app that lets you send photos that appear for 10 seconds or less to your friends, live to regret its decision to snub a $3 billion acquisition offer from Facebook? Some industry watchers think so. Others don’t.

According to the Wall Street Journal, the 23-year-old CEO of Snapchat rejected the $3 billion buyout offer despite the fact that the two-year-old social media phenom has zero revenue to build on. Apparently, Evan Spiegel thinks he can do better with one of his other suitors, like Tencent Holdings. The Chinese Internet giant previously offered to lead an investment that would value Snapchat at $4 billion.

Believing in the Vision

Neither Facebook nor Snapchat could immediately be reached for comment. Snapchat, though, is not without funding. Lightspeed Venture Partners, Benchmark Capital, SV Angel, General Catalyst Partners, and Institutional Venture Partners led a round of funding that raised about $73 million.

But with Instagram grabbing $1 billion from Facebook in 2012, some are questioning the wisdom of Spiegel declining an offer three times that size for an app that’s less established. Julie Ask, an analyst at Forrester, pondered Snapchat’s rejection in a Forbes column:

“There could also be some technology, patents and people in the mix -- but less likely though possibly to be the drivers of billions in valuation at an early stage,” she said. “The founders most likely have a belief or a vision of great things to come -- it’s at the heart of why entrepreneurs do what they do.”

Déjà vu of 1999?

We asked Marcus Nelson, former director of Social Media at Salesforce.com and CEO of Addvocate, a social platform for empowering employees to build brands, for his take on the Snapchat shun. He told us Snapchat's stunning rejection of Facebook’s offer of $3 billion in cash is just that: stunning.

“Because it's being courted by a bevy of VC firms and cash-flush technology companies, it’s like déjà vu of 1999 all over again, irrational exuberance over products with absolutely no redeeming value,” Nelson said.

Nelson sees Snapchat’s move as similar to Chatroulette and the ghosts of other management teams that thought their products were the next big things. In other words, passing on this deal may come back to haunt Snapchat.

“While Facebook sees inherent value in acquiring Snapchat in an attempt to win back the younger demographic that's now steering away from its own platform, one has to question how a mobile image-sharing app that erases images seconds after you receive is anyone’s idea of a killer app,” Nelson said. “I believe the company has a ‘now you see it, now you don't’ future."

Tell Us What You Think
Comment:

Name:

Amadeu Peixe:

Posted: 2014-01-20 @ 7:08am PT
What I will say is that I would have accepted! I presented this idea in March 2006 to a group of Portuguese investors, who did not believe in its potential; (

Like Us on FacebookFollow Us on Twitter
TOP STORIES NOW
MAY BE OF INTEREST
Protect 100% of your Data The prevalence of laptops and mobile devices in the enterprise makes corporate data increasingly vulnerable to loss and breach. And yet, workforce productivity is now inextricably linked to mobility. Click here to access the white paper "Top 10 Endpoint Backup Mistakes" to learn more about how to confidently protect data across platforms and devices while also providing features designed to enhance the end user experience.
MORE IN WORLD WIDE WEB
Product Information and Resources for Technology You Can Use To Boost Your Business

Network Security Spotlight
Dairy Queen Latest Retailer To Report Hack
Known for its hot fries and soft-serve ice cream, Dairy Queen just made cyber history as the latest victim of a hack attack. The fast food chain said that customer data at some stores may be at risk.
 
Lessons from the JPMorgan Chase Cyberattack
JPMorgan Chase is investigating a likely cyberattack. The banking giant is cooperating with law enforcement, including the FBI, to understand what data hackers may have obtained.
 
Who Is the Hacker Group Lizard Squad?
Are they dangerous or just obnoxious? That’s what many are wondering about the hacker group Lizard Squad, which tweeted out a bomb threat that grounded a flight with a Sony exec aboard.
 

Enterprise Hardware Spotlight
Intel Intros Lightning-Fast PC Processors
Call it extreme. Intel just took the covers off its first-ever eight-core desktop processor, which is aimed at hardcore power users who expect more than the status quo from their computers.
 
HP Previews ProLiant Gen9 Data Center Servers
Because traditional data center and server architectures are “constraints” on businesses, HP is releasing new servers aimed at faster, simpler and more cost-effective delivery of computing services.
 
Apple Set To Release Largest iPad Ever
Tech giant Apple seems to have adopted the mantra “go big or go home.” The company is planning to introduce its largest iPad ever: a 12.9-inch behemoth that will dwarf its largest existing models.
 

Mobile Technology Spotlight
iWatch Watch: What Will Apple Ask Us To Wear?
There are still more questions than answers when it comes to details about the smart watch Apple seems poised to debut on Sept. 9. In fact, nobody seems completely sure that it will be a smart watch at all.
 
Samsung Maps Its Way with Nokia's 'Here' App for Galaxy Phones
Korean electronics giant Samsung has opted to license Here, Nokia’s mapping app -- formerly known as Nokia Maps -- for its Tizen-powered smart devices and Samsung Gear S wearable.
 
Google Successfully Tests Its Own Delivery Drone
While top technology companies are engaged in an "arms race" to develop drones that can quickly deliver goods to anyone anywhere, Google has revealed it successfully tested its own version.
 

Navigation
NewsFactor Network
Home/Top News | Enterprise I.T. | Cloud Computing | Applications | Hardware | Mobile Tech | Big Data | Communications
World Wide Web | Network Security | Data Storage | CRM Systems | Microsoft/Windows | Apple/Mac | Linux/Open Source | Personal Tech
Press Releases
NewsFactor Network Enterprise I.T. Sites
NewsFactor Technology News | Enterprise Security Today | CRM Daily

NewsFactor Business and Innovation Sites
Sci-Tech Today | NewsFactor Business Report

NewsFactor Services
FreeNewsFeed | Free Newsletters

About NewsFactor Network | How To Contact Us | Article Reprints | Careers @ NewsFactor | Services for PR Pros | Top Tech Wire | How To Advertise

Privacy Policy | Terms of Service
© Copyright 2000-2014 NewsFactor Network. All rights reserved. Article rating technology by Blogowogo. Member of Accuserve Ad Network.