Instant Messaging App Snapchat-Maker Snap's IPO Opened Trading At $24 a Share, Making the Company Worth $33 Billion (recode.net)

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Instant Messaging App Snapchat-Maker Snap's IPO Opened Trading At $24 a Share, Making the Company Worth $33 Billion (recode.net)

Posted by msmash on Thursday March 2, 2017 @07:25AM from the how-they-think dept.

Snap, the company behind instant messaging app Snapchat, went public this morning at price that values the loss-making tech company at $33 billion. Here's how the investors are valuing the company: At $33 billion, investors are saying Snap is worth 35 times what it's estimated to generate in sales this year, or about $936 million, according to eMarketer. Compare that with Facebook, which is currently worth about 10.5 times its estimated 2017 revenue. In other words, investors, for the moment, think Snap has three times more potential value than Facebook. That's a big bet. Snap lost $514 million last year on $404 million in revenue. Compare that with Twitter, which lost $79 million the year before its IPO, while Facebook made $1 billion in profit. Snap has 158 million daily active users. Facebook at its IPO had 845 million monthly active users and 483 million daily active users.

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I really wonder sometimes.. by Anonymous Coward · 2017-03-02 07:27 · Score: 1

Where these investors get their understanding of technology.
1. Re:I really wonder sometimes.. by DontBeAMoran · 2017-03-02 07:41 · Score: 1
  
  They understand that they set the price of what they're trading. They're thinking they're rich, so they are.
  
  --
  #DeleteFacebook
2. Re:I really wonder sometimes.. by gnick · 2017-03-02 07:45 · Score: 1
  
  They understand that they set the price of what they're trading. They're thinking they're rich, so they are.
  They're setting today's price of what they're trading. They're thinking they're rich, so they feel that way. Today, they can trade their shares for today's price. No longer the case once this particular bubble ceases to be a bubble.
  
  --
  He's getting rather old, but he's a good mouse.
3. Re:I really wonder sometimes.. by DontBeAMoran · 2017-03-02 08:02 · Score: 1
  
  If they can sell all their shares today for that price, they'll have made themselves rich by setting the price themselves.
  
  --
  #DeleteFacebook
4. Re:I really wonder sometimes.. by JaredOfEuropa · 2017-03-02 08:22 · Score: 4, Insightful
  
  Social media operators are not technology companies. They are advertising agencies and marketing data processors. Your understanding of technology is not going to help you assess the worth of these companies or the risk of investing in them.
  
  --
  If construction was anything like programming, an incorrectly fitted lock would bring down the entire building...
5. Re:I really wonder sometimes.. by Anonymous Coward · 2017-03-02 08:50 · Score: 0
  
  Selling all of your shares for the price you bought them at won't make you rich regardless of the price.
6. Re:I really wonder sometimes.. by edtice1559 · 2017-03-02 08:51 · Score: 1
  
  If you bought IP shares at $16 and you sell them today for $25, that's a pretty good return.
7. Re:I really wonder sometimes.. by torkus · 2017-03-02 09:05 · Score: 1
  
  For the investment firms, it surely is. Mere mortals can't buy at the opening bid.
  
  --
  You can get rich if you own a politician, but you have to be rich to buy one in the first place.
8. Re:I really wonder sometimes.. by torkus · 2017-03-02 09:09 · Score: 1
  
  They can't.
  For one, they'd dilute (or dissolve) their voting block.
  Two, there's two people who still have the large majority of shares. If they dumped them on the market en masse the stock price would tumble in a heartbeat.
  Three, a CEO (and founder and majority stakeholder) is expected to hold much of their stock - especially in the short term - otherwise investors will bail too...and stock tumbles once again.
  Also, there would almost certainly be SEC investigations into fraud and insider trading. You don't go public to divest yourself - the red flags would have their own red flags.
  
  --
  You can get rich if you own a politician, but you have to be rich to buy one in the first place.
9. Re:I really wonder sometimes.. by edtice1559 · 2017-03-02 09:17 · Score: 1
  
  Mere mortals can buy IPO shares and I've been offered them in the past. There are certain requirements. You usually have to have a minimum asset base of $250k-500k as well as recent trading experience. Sometimes you can meet some other qualification in order to be considered an experienced investor and your brokerage will offer you the option to buy IPO shares. Usually if you sell the IPO shares within 60 days you won't get offered to buy them again. That's part of the reason they tend to go up initially. There are a lot of "locked up" investors who can't sell, so the number of shares actually available for trading is much smaller than the float.
10. Re:I really wonder sometimes.. by edtice1559 · 2017-03-03 03:50 · Score: 1
  
  It looks like the company pushed pretty hard for a lock-up period for IPO investors. Whenever a company goes public, most pre-IPO shareholders are subject to a lockup period. http://fortune.com/2017/02/28/... So the number of shares available for trading is much lower than the actual float. Also many (if not all) book-runners require their buyers to hold for 60 days. So there just aren't very many shares to trade after an IPO. The price goes up for a paper-gain but doesn't represent a consensus valuation. http://fortune.com/2017/02/28/...
Bubble. by Anonymous Coward · 2017-03-02 07:28 · Score: 0

Bobble.
1. Re:Bubble. by DontBeAMoran · 2017-03-02 07:45 · Score: 1
  
  Oh, I love that game!
  
  --
  #DeleteFacebook
2. Re:Bubble. by Hognoxious · 2017-03-02 09:16 · Score: 1
  
  Bowel trouble.
  
  --
  Confucius say, "Find worm in apple - bad. Find half a worm - worse."
Thirty-Three Billion by sexconker · 2017-03-02 07:32 · Score: 2

As Megatron said to Optimus Prime as he shot him repeatedly (and fatally) while using Hot Rod as a shield: "FALL! FALL!"
The smart money will short this shit into the ground. Snapchat has fewer opportunities to generate revenue than fucking Twitter does.
1. Re:Thirty-Three Billion by OrangeTide · 2017-03-02 07:38 · Score: 1
  
  I'd short it if I had any idea when the bubble would burst. You need to time it just right, and I'm just not good at predicting when wall street will come to their senses on these sorts of tech bubble stocks.
  
  --
  “Common sense is not so common.” — Voltaire
2. Re:Thirty-Three Billion by Anonymous Coward · 2017-03-02 07:40 · Score: 0
  
  More importantly any of us can code an instant messaging app in a month. The software is laughably simple and even in scaling it's just laughably simple. I actually an instant messaging app in one of my masters classes way back in 2003. How anyone could attach a billion dollar valuation to something anyone can replicate with minimal effort and very little manpower is beyond me.
  Twitter cant make money and these guys doubly so.
3. Re:Thirty-Three Billion by Nukenbar · 2017-03-02 07:42 · Score: 1
  
  If you had short it at the IPO price of $17, you would have lost your shirt worse than the The Duke brothers in Trading Places.
4. Re:Thirty-Three Billion by misxn · 2017-03-02 07:42 · Score: 3, Informative
  
  I'd short it if I had any idea when the bubble would burst. You need to time it just right, and I'm just not good at predicting when wall street will come to their senses on these sorts of tech bubble stocks.
  Just buy some long term PUTS and you'll be fine. No need to predict much there. Just sit and wait. (don't use margin)
5. Re:Thirty-Three Billion by sexconker · 2017-03-02 08:06 · Score: 1
  
  Uh, they traded commodities and got illegally scammed (flipping their own scam against them, yes).
  Why would you short at $17? The shitty web 3.0 IPOs hit peak mindshare on day 1, not day 0. The people not in on the con have to wait until day 1 to initiate their trades. Only the big boys get their shit in in advance. Everyone else buys in after ASAP in the mad scramble. The bubble bursts when the big boys want to cash out or when everyone else gets tried of yet another quarter of no profit, no growth, and no dividends.
6. Re:Thirty-Three Billion by Anonymous Coward · 2017-03-02 08:21 · Score: 0
  
  Maybe it's not the codebase that's valuable.
7. Re:Thirty-Three Billion by Anonymous Coward · 2017-03-02 08:55 · Score: 0
  
  Right.
  The value comes from the massive load on their servers which generates negative revenue.
8. Re:Thirty-Three Billion by edtice1559 · 2017-03-02 08:57 · Score: 1
  
  From what I can tell, there are no SNAP puts trading yet. I've often looked at buying puts on companies but rarely ever actually purchased. You usually can't buy puts more than six months in the future and you will pay dearly for them. Often the stock goes down but you still lose because it doesn't go down enough to cover the premium you pay for the put. You can use some long-term rolling strategies but these are very high risk. And the company will work against you. They will release abysmal earnings that validate your hypothesis right after the market closes. But then they'll go on a 16 hour PR blitz to talk about their growth potential. So unless you can acquire the shares after hours and exercise your puts (takes a lot of capital), by the time the market opens, your profit may be gone. Identifying bad companies is not that hard. But buying puts is, because you need somebody on the other side. Actually shorting the stock is cheaper but then you have unlimited risk. To mitigate that you'll have to buy calls which will then eat up a chunk of your profits. And with shorting, time is not on your side. In a long position, patience can win out.
9. Re:Thirty-Three Billion by torkus · 2017-03-02 09:16 · Score: 1
  
  It's not the coding. Code monkeys are easy to rent.
  It's the idea and, critically, the user base they've built. I'm not saying they're anything special, the 158 million users are.
  Now, there's immense potential competition - FB messenger and whatsapp jump out. Others like KIK and the myriad of chat/IM/social media sites are the same.
  Snap's plan is to broaden the offering and become more like a visual FB/twitter/IG ... except those already are good at what they do. Minor tweaks would put them on par (see: code monkeys).
  There's one fundamental difference between many of the platforms - and that's identity. FB and Whatsapp target a 1:1 existence with your real self (phone number, etc.) while snap/IG/twitter/etc. are based on arbitrary names.
  
  --
  You can get rich if you own a politician, but you have to be rich to buy one in the first place.
10. Re:Thirty-Three Billion by Anonymous Coward · 2017-03-02 09:21 · Score: 1
  
  Short positions are damn near impossible for the retail investor to take against new IPOs. The CBOE typically does not start listing option contracts until 60 consecutive trading days have elapsed and obtaining share lends for short selling on IPOs are all but non-existant if you don't already have an inside track on them. Really the only people that make money selling shares of new IPOs in any capacity are the underwriters and insiders already holding onto convertible notes predating the IPO (company directors, employees with vested options and the like).
11. Re:Thirty-Three Billion by roman_mir · 2017-03-02 09:21 · Score: 1
  
  when wall street will come to their senses on these sorts of tech bubble stocks
  - they are well within their senses.
  The problem is that they have no yield in anything else, so they are searching for yield. The yield is gone however, that's because the government destroyed it, annihilated it completely. That's because the government needs cheap borrowing, if the interest rates were anywhere near their historical normals, the USA government couldn't continue to exist even if it had to pay that type of interest (never mind paying back the actual principal)
  The government together with the Fed have destroyed the yield curve on the one hand, on the other hand they money for speculation is flowing due to the same Fed and policies that provide the cheap money flow. The banks and mutual funds, the pension funds, municipal, State, private, they are all looking for yield.
  Instead of finding a legitimate source of yield in some legitimate business, they are pushed into gambling on stocks, into a giant casino and this casino is the market that is manipulated by the fake interest rates, fake money supply and various other factors that the government is responsible for.
  To ask the question this way: 'when will the wall street come to its senses' is pointless, it misses the point that the wall street never had any senses except for one: where is the yield. For the lack of better options the yield does not come from legitimate business borrowing (legitimate businesses cannot borrow with 0% interest rates, their borrowing is much more expensive than that, why would a bank lend to a legitimate business the money that it knows could be spent in a giant casino that promised much better gambling returns and besides if the bank loses the money the government will bail it out).
  The government under Obamatron (and many times before him) has made it abundantly clear: you can lose all the money you like, we WILL bail you out.
  So when will the wall street come to its senses? It is well within its senses.
  
  --
  You can't handle the truth.
12. Re:Thirty-Three Billion by OrangeTide · 2017-03-02 09:51 · Score: 1
  
  My comment has to do with the perception that there is a lot of emotional trading going on.
  
  --
  “Common sense is not so common.” — Voltaire
13. Re:Thirty-Three Billion by Anonymous Coward · 2017-03-02 09:56 · Score: 0
  
  Mmmm Daisy Duke. I'd take her shorts 7 days a week. where are these shirtless pics?
14. Re:Thirty-Three Billion by roman_mir · 2017-03-02 10:15 · Score: 1
  
  Sure, and it will continue as long as the banks are bailed out in case of failure, so under those conditions it only makes sense to trade on emotion and to gamble as much as possible. It's heads I win, tails you lose scenario, so wall street is not off their rocker, they are quite rational.
  
  --
  You can't handle the truth.
15. Re:Thirty-Three Billion by edtice1559 · 2017-03-03 03:54 · Score: 1
  
  I think that the period for options listing is five trading days not sixty. So it may be possible to buy puts well before the lockup-period ends. But I agree with you generally. Short-positions are near impossible for retail investors even on non-IPO shares. http://www.theoptionsguide.com...
Alas, I'm too smart to make money on this one. by Anonymous Coward · 2017-03-02 07:33 · Score: 1

I'm just not stupid enough to be able to see why this, like Facebook, could possibly be profitable. So, I'll lose out on this one, too.
1. Re:Alas, I'm too smart to make money on this one. by viperidaenz · 2017-03-02 07:37 · Score: 1
  
  because selfie.
2. Re:Alas, I'm too smart to make money on this one. by youngone · 2017-03-02 07:54 · Score: 1
  
  I'm just not stupid enough to be able to see why this, like Facebook, could possibly be profitable. So, I'll lose out on this one, too.
  Snap inc. don't know either. They didn't even make a secret of it.
  I don't understand why anybody would bother investing in this, but I'm going to assume that a huge investment bank will make a huge profit, so that's probably the reason.
3. Re:Alas, I'm too smart to make money on this one. by Anonymous Coward · 2017-03-02 08:32 · Score: 0
  
  Dude the new dog filter is worth at least $5b
4. Re:Alas, I'm too smart to make money on this one. by Anonymous Coward · 2017-03-02 08:48 · Score: 0
  
  I'm just not stupid enough to be able to see why this, like Facebook, could possibly be profitable. So, I'll lose out on this one, too.
  They, via their TOS, own licenses to resell all the images people send using their system.
5. Re: Alas, I'm too smart to make money on this one. by Anonymous Coward · 2017-03-02 10:25 · Score: 0
  
  Its because others are stupid enough to buy in. Doesn't matter if its dog shit they are selling, if I can sell dog shit to some one else later for a higher price I'll buy now.
6. Re: Alas, I'm too smart to make money on this one. by edtice1559 · 2017-03-03 03:55 · Score: 1
  
  This is the "greater fool" method of investing. It's also high-risk because you are holding a valueless asset. Always scared me away but others may have the stomach for it.
It's worth 8 Lucasfilms! by Anonymous Coward · 2017-03-02 07:41 · Score: 0

Remember that investors never make mistakes and we should surrender all decisions with regards to the economy to them.
$24 question by belthize · 2017-03-02 07:41 · Score: 1

Back during the first bubble, particularly around the time that Redhat went public, I was fascinated at how many IPOs were priced in the $15 to $30/share range regardless of what that implied about their total value.
These folks have figured out how to game the uninformed investor looking to make a quick buck on IPOs. $5 makes people think the company is a dog, $50 to $100 makes them think it's overpriced. The fact that neither number says anything about valuation is immaterial.
So sure, $24 looks like a great price for a piece of stock, who cares if it implies a grossly overvalued stock.
1. Re:$24 question by Anonymous Coward · 2017-03-02 07:47 · Score: 0
  
  What uninformed investors? 90+% of trading is institutional money? Charlie and his little Schwab account with $5000 in it is not moving the market. This is your 401k and pension fund doing this.
2. Re:$24 question by belthize · 2017-03-02 07:52 · Score: 1
  
  Not my pension fund.
  And your statement would be true w.r.t. the market as a whole but IPOs have an inordinate number of small investors.
  There's actual academic research on the subject, first hit on a quick search: http://citeseerx.ist.psu.edu/v...
3. Re:$24 question by Rockoon · 2017-03-02 08:13 · Score: 1
  
  If your pension holds any index funds, then its still quite true.
  
  --
  "His name was James Damore."
4. Re:$24 question by shess · 2017-03-02 08:46 · Score: 1
  
  Back during the first bubble, particularly around the time that Redhat went public, I was fascinated at how many IPOs were priced in the $15 to $30/share range regardless of what that implied about their total value.
  These folks have figured out how to game the uninformed investor looking to make a quick buck on IPOs. $5 makes people think the company is a dog, $50 to $100 makes them think it's overpriced. The fact that neither number says anything about valuation is immaterial.
  So sure, $24 looks like a great price for a piece of stock, who cares if it implies a grossly overvalued stock.
  I'm not sure where you're going, here. If people are more comfortable buying a $15 stock than a $150 or $1500 stock, regardless of the share multiplier, then the industry is going to figure that out and target it. They aren't "gaming" the uninformed investor, if the uninformed investor is out there throwing money at random stuff, it is not the job of investment banks to step aside and avoid that money.
  My experience with tech IPOs is that there are probably a bunch of brokerages who finagled "friends and family" type access and locked clients into purchases which are inappropriate to their portfolio. _That_ is bad, but it's not really specific to tech IPOs (if you're letting a full-service broker tell you what to do, you're already in a world of hurt).
5. Re:$24 question by edtice1559 · 2017-03-02 08:58 · Score: 1
  
  SNAP is not in any indices
6. Re:$24 question by bytesex · 2017-03-02 09:10 · Score: 1
  
  Are they allowed to take risks like that?
  
  --
  Religion is what happens when nature strikes and groupthink goes wrong.
Investment strategies of 20 years ago... by Anonymous Coward · 2017-03-02 07:44 · Score: 1

These guys are all "oh man, this product is in millions of peoples hands! The potential! The exposure!" while failing to take into account that people use it because it's free (path of least resistance), and the second you start trying to charge/disrupt the experience with ads... MANY of them will look elsewhere
1. Re:Investment strategies of 20 years ago... by Anonymous Coward · 2017-03-02 07:51 · Score: 0
  
  I still don't understand what's wrong with sending vanilla SMS text messages and why anyone needs a SnapChat? What exactly am I missing by using SMS?
2. Re:Investment strategies of 20 years ago... by Anonymous Coward · 2017-03-02 08:04 · Score: 0
  
  SMS doesn't work on computers.
3. Re:Investment strategies of 20 years ago... by Rockoon · 2017-03-02 08:19 · Score: 1
  
  Potential for growth is very important when valuating a stock, regardless of how long ago the IPO was.
  
  --
  "His name was James Damore."
4. Re:Investment strategies of 20 years ago... by Anonymous Coward · 2017-03-02 08:20 · Score: 0
  
  I tried using WhatsApp and Telegram on my computer. The experience is pitiful, and still can't be initiated without a phone anyway. These programs are all just extensions of the surveillance state and decrease online anonymity, which I think is really important.
5. Re:Investment strategies of 20 years ago... by R3d+M3rcury · 2017-03-02 08:21 · Score: 1
  
  What is this "computer" of which you speak? You mean those big-honkin' things that sit on a desk? Like what my Mom bought back when I was kid to get email?
6. Re:Investment strategies of 20 years ago... by xeoron · 2017-03-02 10:40 · Score: 1
  
  Many kids that I talk to say they use it because it auto deletes messages so it is safer, for filters, and because everyone else is using it for their age range. But then I tell or show them how easy it is to recovery deleted messages their faces turn to panic out of fear that what was viewed as a privacy app, now is more real for leaks of what they are up to. I think if most of their user based realized how insecure it is compared to other options, they would shift to this, since it seems like this was the first core reason kids/teens started to use SnapChat, because they do not want things to be public like on other social networks.
Quantitative Easing by Anonymous Coward · 2017-03-02 07:52 · Score: 0

Those free cash gotta go somewhere right?
Good that uninformed lose decision-making power by Anonymous Coward · 2017-03-02 07:55 · Score: 0

It is often thought that it is a bad thing for the uninformed get-rich-quick "investors" to be "swindled" in this fashion; on the contrary, it is a very good thing.
Such people are being stripped of their ability to allocate society's scarce resources to some other stupid idea—and even better, some of these fools will find the lesson illuminating, and thereby escape their foolishness, to the benefit of the rest of society.
Your bank balance is a proxy for your ability to make decisions for society, and you should lose some of that ability whenever you make a bad decision (and you should gain that ability whenever you make a good decision).
Do not pitty the fool. Instead, be glad that he has been removed from power.
Could be another Twitter or even worse by Zontar_Thing_From_Ve · 2017-03-02 08:28 · Score: 4, Insightful

Twitter is currently trading within two dollars of its 52 week low as concerns mount that it may not ever be profitable. I don't use Snapchat. I have nothing against it, but I have no use for it. I have read recently that all of their competitors do everything that Snapchat does, but they all do it better. Snapchat was just there first. I'm sure that some people will make money on this stock. Those who got in close to the IPO opening price may have already sold it off for a profit. The investment bank that backed the IPO certainly has already made a ton from today's market action. But this is the same market with the same investors who kept SCO alive for years at almost $5 a share in the hopes that it would win its lawsuit so I won't be surprised if Snapchat eventually dies and many of those investors end up taking big losses on it.
1. Re:Could be another Twitter or even worse by Anonymous Coward · 2017-03-02 09:03 · Score: 0
  
  Snapchat has the younger end of millennials and whatever the generation younger than them is behind it, but they don't really offer much for turning a profit. What sort of data mining can they do with tons of (supposedly) instantly deleted selfie video clips to attract advertisers? Also, when/if they start bombarding users with ads, it'll be far more in their face than with FB and Google who mix a little bit in with the content the end user is there for. It honestly seems way overhyped and at a very high risk of losing momentum as their user base gets bored with it and latches on to some other cool, free social app with no ads. Also, despite starting higher than expected, the stock price has remained pretty steady throughout the day.
Can't believe we're repeating the dotcom bubble by ErichTheRed · 2017-03-02 08:43 · Score: 2

Back in Dotcom Bubble 1.0 it was "eyeballs" - now it's "engagement". Companies IPOing back then also had no concrete plan on how they were going to make money. This is reminding me of the second phase of the last bubble. First it was VC firms pumping money into anything that involved a web browser, then trying to recover their investments by pumping the companies out to an unsuspecting public. Facebook and Twitter were the first, Snapchat might be a VA Linux or a TheGlobe.com.
The thing that sucks is all the bankruptcy sales won't have any cool servers, storage or network gear since it's all in The Cloud this time around.
1. Re:Can't believe we're repeating the dotcom bubble by Anonymous Coward · 2017-03-02 09:14 · Score: 0
  
  What's important is that mutual funds, especially retirement funds, don't get into this kind of "investments". VC's losing money, good times!
lol snapchat by rakslice · 2017-03-02 08:55 · Score: 1

Imagine what their company could be worth if their software had a good UI? ;)
More interesting question.. by MrL0G1C · 2017-03-02 08:59 · Score: 0

Is how would we act if we found alien life (non-intelligent) and could send a ship to study it, would we allow the ship back? Or would we have a permanent physical contact ban in case of deadly life forms that our species couldn't cope with.

--
Waterfox - a Firefox fork with legacy extension support, security updates and better privacy by default.
Let's party like its 1999...again by Tangential · 2017-03-02 09:28 · Score: 3, Insightful

This is crazy. They are losing money and they have no clear runway to working business model. Its like a flashback to 20 years ago. Apparently a whole new generation of investors has to learn all of these lessons for themselves.

--
Suppose you were an idiot. And suppose you were a member of congress. But then I repeat myself. -- Mark Twain
1. Re:Let's party like its 1999...again by Anonymous Coward · 2017-03-03 05:06 · Score: 0
  
  What's crazy about that? A lot of public companies are losing money at the time of their IPO, and even remain so for years. The truth is no one looks at profitability so long as revenue is growing fast. Even companies like Amazon is not profitable because they spend their money on R&D.
Its everywhere by future+assassin · 2017-03-02 10:12 · Score: 2

I went to a night club about a 1 year ago since about 7 years and 80% of the people in there were wearing tight cut off jeans and florescent tshirt and shit that looked liked I was back in high school in the early 90's. New generation just recycle the same shit although I wont mind when those womens low cut jeans come back instead of the current mom bum 90's look.

--
by TheSpoom (715771) Uncaring Linux user here. I have nothing to add to this but please continue. *munches popcorn*
A fool and his money... by Anonymous Coward · 2017-03-03 00:58 · Score: 0

Let's see: did we invest in a company with no revenue stream? Check. Is it only used by people who lack the means, were we to charge for it, to pay for it? Check. Has it been hemorrhaging money for years? Check.
Yep, we've got all the signs of a sure winner here.
Revenue? by tehcyder · 2017-03-03 01:20 · Score: 1

You value a normal company on its projected profits, not its revenue.
You can have a trillion dollars in revenue, but if you're still making a loss your company is worthless.
But different rules seem to apply to Tech stocks.

--
To have a right to do a thing is not at all the same as to be right in doing it
1. Re:Revenue? by edtice1559 · 2017-03-03 03:57 · Score: 1
  
  When a business is a growth company, revenue valuations are reasonable. If the plan is to use all of the profits to grow the company, the profit will always be zero. This is a reasonable strategy. It certainly worked for Amazon. When buying zero-profit companies, you have to decide whether they are actually going to turn into a profitable business. I don't see much hope for SNAP.