The parent company of popular instant messaging app Snapchat has finally made its way onto the US stock market this morning, managing to become one of the most anticipated appearances in a long time.
Many investors were enticed by Snapchat’s allure to teenagers and young adults, who use the service more than 18 times a day, on average, thereby bumping Snap Inc’s market value to a whopping $24 billion, approximately $17 a share. This amount is double that of Twitter, its primary rival.
The sale also rendered Snap Inc as the most successful US tech company on the stock market since the success achieved by Facebook in 2012. It may also have set the precedent for other tech start-ups expected to enter the markets in the near future.
Snap’s pricing came on the same day which saw another surge in the stock market due to expectations raised by the Trump administration. Investors of the California-based company seemed to be undeterred by the fact that it has failed to turn a profit, registering losses of over $500m last year and user growth looks to be slowing down. A controversial decision was also taken establishing that investors will have no say in the company as such and control will be retained by its founders, Evan Spiegel and Robert Murph, even if they were to resign.
Moreover, investment firms are taking advantage of the hype; popular social trading network eToro has made Snap Inc shares available for trading on its platform. Meanwhile, popular gaming operator BetonFInance also launched a game before the IPO was announced, where players could bet on which range they believe the offering price will be within.