Snapchat is an app for smartphones that enables users to send short pictures and videos messages to anyone that they have as friends. Recently Snapchat was offered $3 billion in cash from Facebook and $4 billion from Google both of which were turned down founder Evan Spiegel. An interesting blog by Timothy B. Lee on the Washington-post helps to explain why Snapchat will soon be worth more than $4 billion.

Timothy goes on to explain how “Snapchat has recently revealed that it serves about 350 million “snaps” per day” and compares that to Twitters timeline views. Twitter served 287 billion timeline views in the first half of 2013 where it made $253 million in revenue.

Timothy then suggests that if each snap generated on a daily basis can bring in the same amount of revenue of Twitters daily timeline views then the company would be making around $100 million a year, with a lot of growth potential. To me this clearly shows the capability of Snapchats potential and the reasons why it turned down Google’s and Facebook’s offers. With the correct advertising and marketing skills, Snapchat will quickly be worth a lot more than $4 billion and therefor I think that Even Spiegel made the chose of turning down those two generous offers.

References:

WashingtonPost Blog: http://www.washingtonpost.com/blogs/the-switch/wp/2013/11/13/of-course-snapchat-could-be-worth-3-billion/

CNET News: http://news.cnet.com/8301-1023_3-57602049-93/snapchat-rivals-facebook-in-photos-with-350m-snaps-per-day/