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Comment by bsenftner | Hacker News Reader

I don't understand this valuation - it's makes no sense to me. Can anyone explain how SnapChat could be worth even a fraction of this? Where is the value in SnapChat's user base, future blackmail? It's not like someone using SnapChat is in the appropriate state of mind to follow any ads in the app. I don't get it...

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Just like how 37Signals is worth $100bn. https://signalvnoise.com/posts/1941-press-release-37signals-...

That post was mocking Facebook's valuation at the time. Now we know how wrong they were.

My theory is that no data on snapchat's servers has been deleted. Once they hit 100 million users they will have a shyamalan-esque reveal where all their users' photos will be posted publicly on a website for all the world to see except for the users who pay $9.99 per month FOR THE REST OF THEIR LIVES (insert dramatic gasps here) to keep their photos from being revealed.

Aside from such a scheme, I just don't see the valuation as warranted. I could stomach a billion and maybe two, but this is just selling to the greater fool at this point.

I think it's based on the expectation that at some unspecified date in the future Snapchat will find a way to make an unspecified amount of money via an unspecified method.

Commonly referred as:

Step 3: ???

Then step 4 is: Profit!

Perhaps their evaluation isn't based on their profits, but how much value they can remove from other well established businesses? If they steal users from other platforms, like Facebook, then SnapChat is worth the amount of money Facebook is losing.

It's a communication platform that the younger generations are using as their primary form of communication. That is big.. not saying it's $10B big, but SnapChat has the chance to become something larger than just stupid selfies.

What you wrote sounds to me like this: if SnapChat were something else, and not (just?) SnapChat, maybe in the same "space", it could be worth a lot.

Edit: I am deeply skeptical that a market filled primarily with people who have little or no income will support an ad-based revenue stream valued at $10bn. I would be even more skeptical if the revenue for SnapChat were supposed to come from a pricing structure.

They may have a chance of becoming a useful communication platform, but at $10bn, there's not a huge amount of upside left. I'm struggling to see how the very substantial risk of not becoming that platform could have been priced into the investment.

So were ICQ, AIM, MSN, Google Chat, texting, maybe FB messenger, WhatsApp.

I myself have migrated my primary messaging platform through half that list. Isn't there a tremendous risk snapchat users leave that platform the way users have moved from one messaging platform to another for years?

and, quite importantly one that is not yet owned by facebook.

IMHO, it's yet another gross over-valuation of a tech startup. The Over-valuation Bubble will burst... eventually. These companies are not really worth their current valuations.

Of course. Since Snapchat didn't go the way of Tumbler or Instagram, they have to monetize their platform with ads like Twitter or Pinterest.

It will happen one day.

The real value that they have is the huge user base of kids who will forget about snapchat once they go to college.

i increasingly feel that we are not in a bubble, but we are in THE bubble

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