However, this just feels completely out of proportion to earnings and downside does not seem priced in. Willing to be proved wrong of course, but especially seeing as they are non voting shares, I cannot understand this pricing.
Bitmoji has been the #1 iPhone app overall since January 11, and it was already the #1 iPhone Utility app since July 22, 2016 (Log in to see) -
https://www.appannie.com/apps/ios/app/bitmoji-keyboard-your-...
https://www.appannie.com/apps/ios/top/united-states/overall/...
And yesterday on eBay, 22 pairs of Spectacles were sold, with one pair went for $229 and 2 others went for $200 each, even though http://www.spectacles.com has been offering them for $130 since last Monday -
http://www.ebay.com/sch/i.html?LH_Complete=1&LH_Sold=1&_from...
Then there is the rumored Android Snap Phone:
http://mashable.com/2017/02/14/snapchat-phone-concept-design...
And Snap Drones, as reported on page 2 of today's NYTimes -
https://www.nytimes.com/2017/02/28/technology/snapchat-drone...
Snapchat isn't making any additional money from the Spectacles resellers though.
How do you value that? I'm of the opinion that AR style glasses are the technology that will be the next tech wave post mobile phones (FB buying Oculus and Google pushing so much money on MagicLeap is explained for a similar reason).
So how do you consider Snap's Spectacles? Say there's a 10% chance that they become the initial dominant hardware player in the post-phone mobile space? What's that worth?
If snaps taken with spectacles ever make up more than a % or two of snaps, I will be surprised.
It's a pair of glasses that stream video from a camera. I'm not saying it's not cool, but what is so crazy about it that it's hard to value?
>What's that worth?
If you're buying IPO shares and can't answer that question yourself, you're probably doing something wrong.
Consider that they are pretty indisputably the leaders in terms of shipping real, actual working AR on mobile -> https://youtu.be/Pc2aJxnmzh0
So "how do you value" the number one AR company on the planet having shipped their first hardware device that:
- Has sidestepped all the "glasshole" baggage of Google Glass
- Genuinely nice looking non "borg" styling
- Actually works as intended
- Masterfully executed on a unique and successful marketing rollout. I completely agree on your point that it's a "pair of glasses that stream video from a camera", the important thing is that they've built a whole distribution and demand system where that is actually something people want in large numbers.
So, compared to MagicLeap, HoloLens, etc. SnapChat is working from a "worse is better" standpoint where their v1 is horrible on a feature vs feature basis against the Hololens (and presumably whatever MagicLeap is going to ship).
But, I feel pretty confident in thinking that they're selling many more units of their Spectacles (at $129) than Hololens (at $3,000) and they're learning at a much faster rate.
The question is: What will Spectacles v2-v5 look like? At what point do they not need a mobile phone? At what point can they make phone calls? At what point do they get gestural support (another area where Snapchat feels like a leader on mobile).
It's hard to look at an early click-wheel, monochrome screen iPod and see a mobile phone ecosystem worth trillions of dollars and I think it's far from certain that Spectacles are the equivalent, but I think there is a real chance that is the case.
The same way you value anything. AR might be "new", but "new" things aren't new; they come out all the time, forever.
>It's hard to look at an early click-wheel, monochrome screen iPod and see a mobile phone ecosystem worth trillions of dollars
Which is why it would be incredibly naive to, in any way, predict Snapchat to have that sort of success, because it is so incredibly rare. It's like playing the lottery: yes there's a winner, but the odds of any individual company becoming "best ever" are incredibly slim. I have the same sentiment toward TSLA. I invest accordingly.
I think we are saying the same thing, I just lean cynical.
https://en.wikipedia.org/wiki/Pet_Rock
>> Pet Rock is a collectible conceived in 1975
We're still talking about it forty years later. I knew exactly what you meant by pet rock without having to search for it.
The point is that proven execution is a good thing, because it implies you'll do it again.
Anecdotally, it's been interesting to see GoPro take off over the years, spreading from "extreme sports pros" at the beginning to include more casual/recreational uses now. A lot of friends who wouldn't have considered buying a GoPro 5 years ago (because "they don't do anything exciting/dangerous enough to need it") are now considering GoPros to document the slightly more exciting parts of life. These same friends are even more strongly considering Spectacles, because Snap made a product that fits into their lifestyle (lowering the barrier of what is "interesting enough" to capture)