Evan Spiegel’s Imperious Style Made Snapchat a Success Until Users Fled
wsj.com
wsj.com
> Nearly all senior executives who worked with him before the IPO are gone, and more than 10 senior employees have departed in the past year.
If you want to retain good people, you need to give them real input and control.
Senior managers were trying to prevent a disaster and Spiegel did not listen to them -- but even if every decision he made had turned out to be correct, his leadership style still would have alienated many of them to the point they would have wanted to leave. These are successful people who have no problem finding other opportunities.
Perhaps in twenty years we will hear about “awful conditions at Tesla but I knew we were changing the world” or some such.
I have yet to see a SINGLE sign of Evan any where close to Steve Jobs quality. Evan may be good, but he is not a genius like Steve. The only one praising are his VC which during Pre IPO era were constantly spamming twitter about how good his Keynote and unseen since Steve passed away.
Surely you’re joking? I make software for a living and I was utterly and completely lost in Snapchat. Easily the most confusing software I’ve used in a long time.
Not to say that making your app unnecessarily annoying is grounds for success! There were probably 500 apps on the very same day as Snapchat launched that you never heard about.
[1] No peer reviewed study or anything. Just, you know, kids.
There was also this lovely feature where you could see anyone’s “best friends” (aka who’s banging who).
As someone who’s Snapchat’s target market I greatly miss all of that. After they ruined the app I deleted my account and never looked back.
It's understandable that Snap wanted to improve its design. On principle there is nothing wrong with that, but that's not what they actually did because the CEO ignored a lot of warnings that the changes were not improvements.
They can just acquire those companies, which is the strategy used by Google, Facebook, Microsoft and other giants that are moving faster than startups now by deploying capital faster and better than ever before.
Snapchat is heading toward bankruptcy or a forced sale if they don't dramatically cut costs. They're down to $1.4b in cash (from $2b three quarters prior). They can't safely buy an Instagram at this point. Pretty soon they're going to be the $1-$2 billion acquisition.
Twitter is in much better financial condition of course, although a $1-$2 billion acquisition is still a huge chunk of change for their business ($6b in cash, ~$300m-$400m per year in profit). Twitter's problem is that their cash is precious, because their business doesn't generate a ton of it (they've been persistently hauling billions of cash around from their past funding days). That cash is a big safety buffer that they can't easily replace if they burn it. They can use their market cap of course, and shareholders will only tolerate so much of that at their size and given their non-growth context. Twitter needs to figure out what it wants to do before the market 'realizes' what they're actually worth (zero growth gets you an optimistic ~20 PE * $350m profit = $7 billion; a further 2/3 drop from here); it's similar to the old Yahoo scenario pre Alibaba (no growth, the market temporarily giving you an abnormally high valuation, a trapped product).
The giants are seemingly moving fast because they have comically obscene amounts of cash pouring in and can't figure out what to do with it (other than share buybacks ala Facebook, or other capital return programs; in Google's case, they're just piling it up or buying real estate). So they spray it all around. A billion dollar acquisition mistake is meaningless if you're Microsoft and generating ~$40b in operating income (next four quarters). For Snapchat, it'd be fatal.
Google's net tangible assets are up to $149 billion now. They're starting to look more like a financial company than a tech company. Like a private equity company that happens to own a lucrative search engine monopoly and a media company (YouTube). JP Morgan's net tangible assets by contrast are $182b and Bank of America is $170b.
Agree with the rest. It's both interesting and troubling that the giants have so much cashflow that they continue consuming new companies for a long time without worry. All companies die eventually but we're in a whole new world with 1T market caps.
YouTube was a bleeding disaster of a business when Google scooped them up, for a price that was universally mocked as outrageously high. I'm skeptical even Twitter with their $6b in cash could absorb that type of mess and see it through.
The problem you run into, in trying to buy interesting competitors, is they're not for sale for cheap if they're actually any good. That's the specific reason Instagram went for what was considered a very high price. When growth looks that good, the VCs will fund you indefinitely, so the acquirer has to pay a massive premium. In the post Flickr era you can't buy Instagrams for $50m.
This has been a problem for about 30 years online, so good luck with all that.
> add an edit button
User tweets out something nice. 10k retweets. Then changes it to something political.
"What an amazing pitch!" becomes "what an amazing witch!" (or worse). Well-known users would hate it because they'd be mocked for stepping into the troll trap.
I don't see how you can ever make it valuable in its current form to people who don't need to see this tweet or this thread before anyone else does. Hashtags are fundamentally, unalterably, different from usenet groups or message boards or even facebook groups. Content is less permanent, but not in an arguably "good" way as Snapchat's is.
That requires hiring one or two really good developers and product managers and letting them polish the product. You can get a great product that way, but not a billion-plus valuation.
If you want your valuation to grow, you need to hire thousands of really bad programmers and hundreds of very bad managers, endlessly churning out "updates" and "redesigns" and "refactorings".
Nobody ever got to be a billion-plus company by keeping headcount and expenses low.
Cell phone OEMs differentiate with camera quality and so some run some pretty heavy post processing to make images come out okay.
Snap probably cares more about quickly taking picture and the filters.
If they have so many resources, a decision like this is baffling.
This changed a couple of versions a go and if you used SnapChat on the pixel 2 it used the new APIs instead of taking a screenshot.
But I can’t comment persoanally on the quality of snapchats pictures as I’ve never used it.
I believe since Lollipop they have been using the new camera API for Android.
And, depending on phone (esp budget android) it really can take up to like 2s for a still to go off.
Reddit did their redesign right. Many people hated it and they gave the option to go to the old reddit immediately after the new version was released.
You can change the subdomain to "i" on any reddit page, or access the same version by adding ".compact" to the end of the regular URL (which can be more convenient, thanks to the ".com" button on mobile keyboards): https://www.reddit.com/.compact, https://www.reddit.com/r/CatsStandingUp/comments/7bcm79/cat/..., etc
After revisiting the old site, I didn't think I'd miss it, but the old site is just much better in many ways.
But the old site really is better. Especially if you use RES.
I’m not sure what is it that you find good about the new design? The old one did the job perfectly with the added bonus on working on less powerful machines.
I think the guy is a genius but he made a very bad mistake with the redesign and is clearly paying for it. There were some very interesting people producing content for entrepreneurs on there but they're all gone for now.
I've gone from daily to monthly use. But I keep checking in because I'm really convinced that they can still pull a rabbit out of the hat.
Everything is about money, so I always assume that to be the case for all these kinds of articles. Regardless, I’m pretty sure snap will be gone in a couple years. No way they can stand up to Facebook imo.
Snap's operating picture is an accountant's nightmare.
By the time Facebook was five years old, fiscal 2009, they generated a $229m profit on $777m in sales. They turned profitable in the second half of their fourth year. Why? Relative financial discipline. Snap has taken the opposite approach, wild financial irresponsibility (no doubt encouraged by the fairly bubbly funding environment they got to enjoy).
By the time Facebook went public, they had been profitable for over three years. They generated a $1b profit on $3.7b in sales in 2011, the year prior to the IPO. The situation could hardly be any more different from Snap at IPO or today.
As you probably know Facebook( Instagram) did copy " stories" from Snapchat. When your competitor effectively steals your secret sauce, what do you do? I believe that is why they went with their radical UI design change.( In order to retain users, which backfired)
I am not justifying the cash burn that snap had, just saying that competitors definitely were a factor in them not being financial disciplined.
Another major negative was from the get go with that their shares listed are non voting which was a major turn off to wall street which got them blackballed from being included in the SP500.(Has nothing to do with running a company or financial discipline, but definitely a negative when large institutions cannot invest in you because of strict bylaws.)