Snapchat isn't a "project" anymore. It's a business.
Maybe I don't quite get Snapchat, but color me unimpressed.
Facebook... it's just a way to create a profile of yourself and share pictures and messages. Color me unimpressed!
Tumblr... it's just a basic blogging platform... nothing new? Color me unimpressed!
Twitter... it's a 140 character status updates? Color me unimpressed!
Assuming that a startup's early state is little indication of what it eventually turns into, why would somebody invest in any one over another? I cannot imagine a whole lot of people saying "well, this Snapchat thing looks really stupid now, but hey, who knows, it may be big one day!"
They definitely do.
>they just seem sort of lackluster to me for much the reasoning that you've mocked above.
Not everyone is capable of being Elon Musk and creating SpaceX and Tesla. These types of products are low-hanging fruit for people with 0 initial capital.
>Assuming that a startup's early state is little indication of what it eventually turns into, why would somebody invest in any one over another?
Engagement and growth.
What I dont understand is how they make money beside getting people to invest in them.
That makes me sad :(
This is what makes me despair about ever possibly being some sort of inventor/entrepreneur. While I was under the impression that cool new things are what people are after, what they're really interested in, apparently it's just... things like this.
Maybe I should just go make this game - http://www.youtube.com/watch?v=is12anYx2Qs
He gave a plausible and coherent explanation of Snapchat's strategy (spoiler: Tencent of the West). I think that Tencent's valuation is stretched and I think Snapchat is unlikely to succeed even if that is actually their goal... but it was interesting, anyway.
edit: hey, w1ntermute, thank you for that interesting response. Cognitively I think my brain wants a tidy explanation for them turning down the $3B, otherwise I can't make any sense of it whatsoever.
No, he doesn't. All he did was demonstrate his utter lack of understanding of East Asia.
East Asian cultures are high-context, meaning that when Tencent released non-messenger services (that could actually turn a profit), users were much more likely to use them because they were already familiar with the company and its existing messaging service. But this strategy does not work well in the low-context cultures of the West, where people are more comfortable with giving new companies and products a chance. Snapchat cannot expand into other verticals with the ease that Tencent did.
The primary reason why free-to-play games became popular in the West is because the $0.99 floor that Apple set for the App Store drove consumer psychology regarding app purchases, which made it difficult to turn a profit in any other way. Just take a look at Steam to see how much money is being made from non-freemium games.
The important aspect is that the "project" has millions of dollars in investment and employees. Thus, they are accountable to investors and employees who may care about what the public thinks.