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Embarrassing Ex-Employee Complaint Against Snapchat Unsealed (variety.com)

Posted by EditorDavid on from the see-you-for-10-seconds-in-court dept.

"Saying it had 'nothing to hide,' the company behind Snapchat released an unredacted version of a lawsuit filed against it by a former employee that claims investors and advertisers were misled about usage data." And one allegation -- about a meeting with the company's 25-year-old CEO about flawed user metrics and low adoption in India in Spain -- is particularly embarrassing. Pompliano, who had just been hired away from Facebook, contends that he presented methods to address the issue, but that Evan Spiegel, the company's CEO, abruptly cut him off. "This app is only for rich people," Spiegel said, according to Pompliano. "I don't want to expand into poor countries like India and Spain"... Pompliano claims that Spiegel then met with two other executives and determined that "Mr. Pompliano presented a risk to Snapchat's IPO."
It may have been a flip remark, but the lawsuit also alleges two data analysts confided to Pompliano that Snapchat had "an institutional aversion to looking at user data," where its efforts showed "utter incompetence". The former employee -- who was fired after three weeks -- alleges that Snapchat inflated the rate of completed registrations and the number of users who stayed longer than seven days.

Snap originally said the lawsuit should remain redacted because it contained damaging trade secrets that would help its competitors, but now Snap attorneys are accusing Pompliano and his attorneys of "just making things up... The simple fact is that he knows exactly nothing about Snap's current metrics." Variety reports that Pompliano's attorney "said that Snap withdrew its effort to seal the complaint because the company knew it would lose."

85 comments

  1. Spain, a poor country? by Anonymous Coward · · Score: 0

    Spain has one of the highest smartphone per person attachment rates in the world... Not a good idea to ignore that market if you are into "social" "apps".

    1. Re:Spain, a poor country? by Anonymous Coward · · Score: 4, Insightful

      The CEO is a 25 year old, ignorant, narcissistic millennial. What did you expect?

    2. Re:Spain, a poor country? by Anonymous Coward · · Score: 0

      it also has a 30% unemployment rate and a GDP per capita half of its surrounding neighbors, it IS a poor country

    3. Re:Spain, a poor country? by Mr+D+from+63 · · Score: 3, Insightful

      We don't know what the CEO said. Only what one person claims he said.

    4. Re: Spain, a poor country? by Anonymous Coward · · Score: 0

      Spain GDP per capita is 34,861Int$ according to IMF. Its' two neighbours, France and Portugal, are 41,476 and 27,885 respectively. Nothing close to half.

    5. Re:Spain, a poor country? by fabriciom · · Score: 2

      Hello, I live in Spain and I can confirm that we are not poor. Please don't forget to visit and spend your ignorantely earned funds. Thanks! P.S. Spain is in Europe not America (the continent not the country).

    6. Re:Spain, a poor country? by Z00L00K · · Score: 1

      Ever heard of the Streisand Effect? I imagine that Snap hasn't until now.

      If they just had admitted that they had a flaw and then fixed it most people would just have shrugged and gone on with their lives. Now Snap are in the headlines as screwups instead.

      --
      If builders built buildings the way programmers wrote programs, then the first woodpecker would destroy civilization.
    7. Re: Spain, a poor country? by juanjux · · Score: 1

      Also higher than more than the bottom half of US states.

    8. Re:Spain, a poor country? by Highdude702 · · Score: 1

      It is sad that you have to spell that out for everybody here. but i guess it will stop a bunch of ignorant people trying to call you stupid for it lol. well done.

    9. Re:Spain, a poor country? by Applehu+Akbar · · Score: 3, Funny

      The CEO is a 25 year old, ignorant, narcissistic millennial. What did you expect?

      It's Snapchat. That's why the prospectus site was designed to briefly show the usage data, then have it disappear forever.

    10. Re:Spain, a poor country? by TWX · · Score: 1

      I generally expect CEOs to bring something of value to offset their ignorance and narcissism. Most people that head companies that do not bring such end up as little more than small-businessmen, through admittedly the occasional puppet-CEO that's really little more than the Board's strawman-writ-live have been known to exist.

      --
      Do not look into laser with remaining eye.
    11. Re: Spain, a poor country? by Anonymous Coward · · Score: 0

      No it's a lame ass comment taken unnecessarily offensively.

      You can't prove him wrong. Rich poor is only relative... there is no end to arguing so let's just stop there.

      Remember that when JP Morgan died, Rockefeller commented that he was shocked to find out that JP Morgan was not even rich.

    12. Re:Spain, a poor country? by Anonymous Coward · · Score: 0

      A person who has no reason to lie about such a thing. I have no doubt that little shit Spiegel said those words. He's a child, inexperienced, uncultured and who hasn't a clue about anything outside his home town.

    13. Re:Spain, a poor country? by DonaId+Trump · · Score: 1

      The CEO is a 25 year old, ignorant, narcissistic millennial.

      Does anyone have his number? I'm asking for a friend, who definitely isn't looking to appoint a new White House Chief of Staff, believe me.

      John Miller

    14. Re:Spain, a poor country? by sysrammer · · Score: 1

      wtf? An AC post and a lame gin-up of the gen gap? And getting mods, too? Come on, "O wise elders", this is a juvenile statement and not worth reading twice, let alone modding.

      --
      His ignorance covered the whole earth like a blanket, and there was hardly a hole in it anywhere. - Mark Twain
    15. Re:Spain, a poor country? by ckatko · · Score: 1

      Unless its about Trump, then we immediately know we can take any person's claims as 100% truth.

      At least, that's what I've learned from Slashdot. People we know are the bad guys, always did the thing people claim they did.

    16. Re:Spain, a poor country? by drsquare · · Score: 1

      Hard to deny Trump's comments considering he puts them on Twitter or they're recorded.

    17. Re:Spain, a poor country? by Anonymous Coward · · Score: 0

      But... Do they have a code of conduct? /s

      captcha is appropriately: therapy

  2. 25 year old CEO by Anonymous Coward · · Score: 1, Informative

    Stopped reading there. Odds are any company with young people running it will be gone in a decade. Not worth anyone's time.

    Also, once people finally bore themselves of social media fad, these companies will be ruined. Next generation won't care because social media will be their parent's and they won't want to be part of it.

    1. Re:25 year old CEO by ShanghaiBill · · Score: 3, Informative

      Odds are any company with young people running it will be gone in a decade. Not worth anyone's time.

      Like Facebook (Mark was 19), Google (Larry was 25), and Microsoft (Bill was 20)?

    2. Re:25 year old CEO by Anonymous Coward · · Score: 1

      The argument was statistical. Individual examples of companies with young people which survived more than a decade are not valid counterexamples.

    3. Re:25 year old CEO by sjames · · Score: 2

      "Only old people use Snapchat!", S. Korean 14 year old a few years from now.

    4. Re: 25 year old CEO by mrscorpio · · Score: 1

      And disavowing one because of age when not unprecedented is to boldly proclaim your purposefully ignorant attitude.

    5. Re:25 year old CEO by Anonymous Coward · · Score: 0

      The fact that this is "informative" speaks volumes about the dire state of Slashdot these days...

      Those 3 examples pretty much make his point for him, you do realize that, right?

    6. Re:25 year old CEO by sexconker · · Score: 1

      Odds are any company with young people running it will be gone in a decade. Not worth anyone's time.

      Like Facebook (Mark was 19), Google (Larry was 25), and Microsoft (Bill was 20)?

      I'd wager that all 3 of those will be gone or not exist as we know them in one more decade.

      MS is already circling the drain, Google^W Alphabet is chasing after them as fast as they can, and all Facebook can do is copy/buy everyone else in desperation. Their purchase of Instagram and wholesale copying of Snapchat likely bought them a 2 or 3 year extension.

      For Facebook and Google, you can pick any 2 points in time a decade apart and compare. You'll see a vastly different service and business. With MS, you at least see that they're still the same MS even decades apart. You can repeat this exercise with other companies, such as IBM and Oracle, and laugh/cry.

    7. Re:25 year old CEO by GNious · · Score: 0

      And if we show you a list of 1 million companies started by people in their 20's and which lasted less than 3 years?

      Hint: The word "Odds" refer to statistics, not absolutes #Lern2English

    8. Re:25 year old CEO by bravecanadian · · Score: 1

      MS is already circling the drain, Google^W Alphabet is chasing after them as fast as they can, and all Facebook can do is copy/buy everyone else in desperation. Their purchase of Instagram and wholesale copying of Snapchat likely bought them a 2 or 3 year extension.

      Nonsense.

      According to slashdot, MS has been circling the drain almost as long as BSD has been dying.

      Nope, still making billions a year in profit and that is now spanning multiple business lines instead of only Windows/Office.

    9. Re:25 year old CEO by Anonymous Coward · · Score: 0

      I wish I could take your money. The tech companies that rapidly decline from the lead in their respective areas are the ones that desperately cling to their old profit centers and either ignore changes in the market or fail to adjust to them (Kodak and Polaroid are the classic examples).

      All three companies you list are desperately trying to innovate and find the next new thing, either through internal R&D or acquisitions (which are not a bad thing when you have the cash reserves that those companies have). The chances that a competitor will come along and eat their lunch without a fight or an offer they can't refuse is tiny.

      The only way all three companies become irrelevant in a decade is if advances come along that make the PC a dinosaur, web search unnecessary, and some vastly superior social network that manages a similar user adoption rate as Facebook. Odds?

  3. It's called market demographics. by Anonymous Coward · · Score: 0

    In the financial services community it's called "high net worth individuals" - less than a liquid $10 million (houses, boats, planes - don't count) - don't bother calling. That's right. Most of us poor slob peons who are not welcome.

    "I don't want to expand into poor countries like India and Spain"

    I don't see a problem with that - other than dinging Spain. I wouldn't be marketing in Sub-Saharan Africa or most of South of the Border either.

    Good grief folks, his product is for folks who can cough up hundreds of dollars for smart phones. Marketing his service to folks who struggle to get food is a complete waste of resources.

    I really don't see what the big deal is here.

    1. Re:It's called market demographics. by Anonymous Coward · · Score: 1, Insightful

      Should he bother expanding into, say, the United States? Because the average American is "poorer" than the average Spaniard, or any EU citizen for that matter. (don't invoke your GDP per capita, the wealth of the 1% has no bearing on the life of the 99%)

      You realize that there are millions of Americans who are literally dirt poor, right? Or are you just as ignorant as this "fuck you I got mine" American we're laughing about right now?

    2. Re:It's called market demographics. by Anonymous Coward · · Score: 0

      You're grasping. This has nothing to do with Monaco, Greece, fascism, or spaghetti westerns. Wealth distribution in the U.S. looks like one half of a skateboard ramp, and if you set your sights on the 99% then Spain is by comparison wealthier and where the "rich people" are.

    3. Re:It's called market demographics. by LynnwoodRooster · · Score: 1

      USA is around $43K median income, Spain around $21K. There's a reason people worry about the PIIGS of the EU: Portugal,Ireland, Italy, Greece, and Spain. They are the countries that are most in danger of failing economically. High debt, high unemployment (Spain 18%, US 4.9%), or both.

      --
      Browsing at +1 - no ACs, I ignore their posts. So refreshing!
    4. Re:It's called market demographics. by cheesybagel · · Score: 1

      Ever heard of Inditex? Ortega is the richest person in Europe.

    5. Re:It's called market demographics. by Anonymous Coward · · Score: 0

      Wealth is relative. $43K means less in the U.S. than $21K does in Spain. The American banks can conjure up as much fake money from thin air as the clueless American population is willing to borrow, but it won't make your country any richer.

    6. Re:It's called market demographics. by Anonymous Coward · · Score: 0

      Factor familiy debt, student loans and how people (mis)use credit cards and you will get a surprise... Yup, the average Spaniard is richer than the average North American.

    7. Re:It's called market demographics. by LynnwoodRooster · · Score: 2

      The Wikipedia entry uses PPP - Purchasing Parity Power - and accounts for those variables you mention. Disclaimer: American born, having lived and worked in Belgium, Spain, Chile, China, Thailand and the US.

      --
      Browsing at +1 - no ACs, I ignore their posts. So refreshing!
    8. Re:It's called market demographics. by LynnwoodRooster · · Score: 1

      Wiki link I included was in PPP - Purchasing Power Parity. That equalizes most of the differences you want to talk about. And as far as consumer debt goes, the US is about on-par with Spain. So twice the median income, and about the same levels of debt.

      --
      Browsing at +1 - no ACs, I ignore their posts. So refreshing!
    9. Re:It's called market demographics. by LynnwoodRooster · · Score: 1

      Apparently, you're wrong. It's about on-par in terms of consumer debt. But the US has twice the median income in terms of purchasing power parity (equalizing for externalities in the cost of living).

      --
      Browsing at +1 - no ACs, I ignore their posts. So refreshing!
    10. Re: It's called market demographics. by Anonymous Coward · · Score: 0

      Yes it's relative, but it's like the Snapchat CEO have more money than your last 10 generations plus your relatives going back to the last 10 generations, so yeah he can say Spain is poor .... heck he can say Americans are poor. He can just step out into the streets and see what's the chances of bumping into someone rich by his standards.... how do you argue against it? He's a prick.... live with it

    11. Re:It's called market demographics. by iampiti · · Score: 1

      Spaniard here, maybe I shouldn't bother replying to an AC but...
      Economy has been recovering for a few years now and unemployment rate steadily decreasing. We don't have a huge GDP per capita but we have a good standard of living, a high life expectancy and we've been within the top 30 in HDI for many years.

    12. Re:It's called market demographics. by iampiti · · Score: 2

      Yes, we're not super rich but if you've lived in Spain you surely have seen we aren't third-world poor.
      Of course, I can't say if it'd be worthwhile for Spanchat to invest in Spain.

    13. Re:It's called market demographics. by R3d+M3rcury · · Score: 1

      [...] his product is for folks who can cough up hundreds of dollars for smart phones. Marketing his service to folks who struggle to get food is a complete waste of resources.

      But, you see, those people don't have smartphones. So you're marketing to people who do.

      Also, keep in mind the sheer number of people. Even if 90% of India is struggling to get food (which is a percentage I pulled out of my ass--I have no idea about income in India), that's still 120 million people who aren't--about 1/3 the total population of the US. Last I saw, smartphone sales in India numbered in the area of 30 million units. So somebody over there is rich enough to buy them.

    14. Re:It's called market demographics. by LynnwoodRooster · · Score: 2

      Oh, I fully agree! There's a huge world of difference between India and Spain! But there's also a pretty big economic gulf between Spain and the US, or Spain and Germany. Spain is a first world nation, but it's also about in the bottom 1/3rd of the OECD (source). The US is way ahead, in terms of GDP per capita. Spain isn't as bad as Portugal, but I don't think the average Spaniard would claim their country is anywhere near an economic powerhouse.

      --
      Browsing at +1 - no ACs, I ignore their posts. So refreshing!
    15. Re:It's called market demographics. by LynnwoodRooster · · Score: 1

      Average student loan debt in the US is about $37,000, not too far off what the average US car loan of $30,000. And I see a lot of new cars being purchased by relatively new graduates, especially when it's their "first car" at their first post-collegiate job.

      It is also well below the median income of people with a college degree, and the difference between the median high school graduate and the median college graduate is large enough that less than two years of income differential covers for the median college debt - meaning it is still a good investment.

      --
      Browsing at +1 - no ACs, I ignore their posts. So refreshing!
    16. Re:It's called market demographics. by iampiti · · Score: 1

      Agreed

    17. Re:It's called market demographics. by Anonymous Coward · · Score: 0

      Just because someone used the PIIGS term before you did, you don't get to call millions of people 'pigs' without me calling you asshole.

    18. Re:It's called market demographics. by pjt33 · · Score: 1

      On the other hand, GDP per capita is not the most important metric in this context. None of these messaging apps make their money by charging $100 per user: they work by making small amounts of money from millions of people. Spain is in the top third of the OECD by population, and the l10n has quite a lot of overlap with some other large markets.

    19. Re: It's called market demographics. by Anonymous Coward · · Score: 0

      Surely you aren't suggesting pricks shouldn't be called out for prickish behavior.

    20. Re:It's called market demographics. by alok_naik · · Score: 1

      From: http://www.gartner.com/newsroo... Smartphones are expensive for users in India, but with the average selling prices (ASPs) of low-end models falling, Gartner estimates that 139 million smartphones will be sold in India in 2016, growing 29.5 percent year over year

      --
      Every time I think I've hit the bottom, someone lends me a shovel.
    21. Re: It's called market demographics. by LynnwoodRooster · · Score: 1

      Bloomberg, Buffett, Slim, Bezos, Ellison, the Koch brothers - that's 7 of the top 10, all with degrees. Looks like the richest tend to go to university, and tend towards top-notch institutions as well.

      --
      Browsing at +1 - no ACs, I ignore their posts. So refreshing!
  4. "contained damaging trade secrets" by K.+S.+Kyosuke · · Score: 3, Funny

    Pro tip: everyone already knew that your CEO was an idiot, it wasn't exactly a secret. ;)

    --
    Ezekiel 23:20
  5. I DID NOT KNOW INDIA IS IN SPAIN by Anonymous Coward · · Score: 0

    Wow, Internet is good for learning. Proud to be a Trump supporter.

  6. Doesn't matter by Anonymous Coward · · Score: 0

    We don't know what the CEO said. Only what one person claims he said.

    I didn't see anything in the article that warrants any outrage.

    The Baby Boomers really did a job on the Millennials. Over sensitive, taking offense over everything - even when it's not warranted.

    India is dirt poor for a very long and complicated reason that is way too long for a social media post. When you have a product or service that depends on disposable income, it's a smart thing to do to concentrate on folks that have the metrics you target.

    Geeze! It's not like this guy said, "Ok! We'll market to the N*ggers and Ch*nks, but NO IRish!"

    1. Re:Doesn't matter by SharpFang · · Score: 1

      India has a very high income disparity - and enormous population. Taken as average it appears very poor, but if you just look at the sheer number of people with considerable disposable income, you'll spot a market comparable in size to Western Europe.

      Spain is a pretty rich country, about on par with France.

      But if you're an arrogant millenial idiot, you think "Spain = latin america" and "India = only poor, dirty people."

      --
      45 5F E1 04 22 CA 29 C4 93 3F 95 05 2B 79 2A B2
    2. Re:Doesn't matter by Anonymous Coward · · Score: 0

      Oh please, boomie toddlers would scream, smash windows, and call the police when they saw "One of them colored folk" sitting on the wrong half of the bus.

  7. Leave America While You Can by Anonymous Coward · · Score: 0

    Beyond the point of no return, it has plunged into the abyss wholeheartedly. Any and all resistance is mocked until it can't be ignored, and then all rel problems are just glossed over. Wealth all spent for Germany and Japan, fighting the Russians - but now they are the lackeys.

  8. I'm shocked. SHOCKED by Anonymous Coward · · Score: 0

    Internet companies exaggerating clickstream and user account metrics, even making up numbers for presentation to investors and advertisers.

    This is like... an alternative set of facts!

  9. Just plain wrong by onyxruby · · Score: 4, Insightful

    There's nothing embarrassing about not wanting to go into certain places. Chances are very good any company you can think of actively excludes themselves where things don't fit their business model.

    Decisions based on where to offer services are based on demographics, target market, legal landscape, logistics, potential profits and so on. Chances are senior leadership is already going to be aware of their target market and probably doesn't need to do in-depth market analysis to realize certain countries don't make sense. In other words they can dismiss a country with half a second in thought - and be right.

    Now if you want something that actually is embarrassing - we can talk about their data analytics.

    1. Re:Just plain wrong by Razed+By+TV · · Score: 2

      Decisions based on where to offer services are based on demographics, target market, legal landscape, logistics, potential profits and so on. Chances are senior leadership is already going to be aware of their target market and probably doesn't need to do in-depth market analysis to realize certain countries don't make sense. In other words they can dismiss a country with half a second in thought - and be right.

      How "senior" can a 25 year old CEO be?

      And why poach a growth lead from Facebook if you're going to flat out ignore him when he tells you the company is missing an opportunity?

    2. Re:Just plain wrong by Anonymous Coward · · Score: 0

      The embarrassing part was a guy that should know better alienating millions of potential customers

    3. Re:Just plain wrong by Anonymous Coward · · Score: 1

      The embarrassing part was a guy that should know better alienating millions of potential customers

      How many "potential customers" are actually going to be willing to pay two years of salary every month for snapchat services?

      I'd guess that number is in the very small double digits, far from millions.

      If it will cost you hundreds or thousands of times more money to get your infrastructure setup compared to expected profits, it's not worth even doing in the first place.

    4. Re:Just plain wrong by Pinky's+Brain · · Score: 1

      It's embarrassing that he doesn't understand that Spain is still a highly developed economy, nor does he understand Gini coefficients. I guess he wasn't part of the international homeless for long enough to learn from experience what he should have known from general knowledge.

      The embarrassing inexperience of the nouveau^2 rich.

  10. Just looked at a map. by seven+of+five · · Score: 0

    India isn't in Spain...

    1. Re:Just looked at a map. by Highdude702 · · Score: 1

      Sure it is, its right there in the summary! jeez read much?>

  11. Millennials and Money by Anonymous Coward · · Score: 0

    When millennials get money, look out!

    jajajajajajaa

    1. Re: Millennials and Money by Anonymous Coward · · Score: 0

      Latinos laugh funny ;)

  12. lol rich people? by Anonymous Coward · · Score: 0

    No... no not at all, rich people don't bother with this crap... But people on SNAP who still manage to get the latest iPhone are all over this app

  13. What is so "embarrassing"? by mi · · Score: 1

    Which part is supposed to be "embarrassing"? That they wish to focus on wealthy customers? Should Porsche be embarrassed too?

    Snapchat had "an institutional aversion to looking at user data,"

    This part is outright praise-worthy...

    --
    In Soviet Washington the swamp drains you.
    1. Re:What is so "embarrassing"? by fahrbot-bot · · Score: 1

      Snapchat had "an institutional aversion to looking at user data,"

      This part is outright praise-worthy...

      Depends on if they mean their users' data or data about their users. As they're talking about metrics and "utter incompetence" in it's efforts, it seems they're talking about the latter and their inability to properly analyze the data about their users. If that's so, it's not so praise-worthy. (Noting, in the opposite case, that incompetence in *not* looking at the users' data would mean they're actually good at looking at it.)

      --
      It must have been something you assimilated. . . .
    2. Re:What is so "embarrassing"? by Anonymous Coward · · Score: 0

      The part where the CEO is ignorant that Spain isn't a poor country. While it may not be the richest, it certainly isn't impoverished. Even India has richer areas that could be serviced by them.

      The CEO was making excuses for his failure. Porsche probably sells cars in India, assuming the distribution channels exist (they apparently have a website/subsidiary, so I guess they do sell there).

  14. Found the LUDDITE! by Anonymous Coward · · Score: 0

    AppChat isn't for LUDDITE rich people. AppChat is for APP appers!

    Apps!

    1. Re:Found the LUDDITE! by Anonymous Coward · · Score: 0

      Mooooooooooooo

      cows.

    2. Re: Found the LUDDITE! by Anonymous Coward · · Score: 0

      I had sex with your mom's buttocks.

  15. What this really means... by __aaclcg7560 · · Score: 1

    Is that data-driven programming isn't a thing at Snapchat.

    1. Re:What this really means... by fahrbot-bot · · Score: 1

      Is that data-driven programming isn't a thing at Snapchat.

      Maybe the data disappears after 5 minutes, like the attention span of the CEO ...

      --
      It must have been something you assimilated. . . .
  16. Everyone is winging it by Anonymous Coward · · Score: 0

    Everyone is winging it - this is yet another proof that the startup worlds runs entirely on hubris.

  17. Surely more embarrassing by BeanThere · · Score: 1

    is how ugly and badly designed their user interface is.

  18. Will you all put your money where your mouth is by ayesnymous · · Score: 1

    and short SNAP stock?