If you haven’t read about it already, snapchat was offered an astronomical amount by Facebook for its buyout; A whooping 3 billion dollars. Now, I’m no economist or business professional, but if I was owner of a company whose net current value approximated to $860 million dollars, was offered 3 billion for a buyout – nearly 4 times it estimated value – I would be pretty darn keen to signing those papers.

But as we see from recent news, the CEO of Snapchat, Evan Spiegel has indeed declined the offer from Facebook.  “$3 billion isn’t cool, you know what is? Walking away from 3 billion dollars” he says.

Sure, this sounds cool Evan. Smart though? We’d have to take a closer look. Currently Snapchat is a company that has no revenue or business plan; Rejecting the offer thus seems foolish. But, I do believe that this was done for a reason. During the recession, most other companies were losing money. Snapchat though was busy growing, and in today’s world, where social media sites are fueled by photo and video sharing, it found its fortress.

Snapchat has hence declined the offer, understanding that it’s value proposition is trending in today’s industry, and a buyout far bigger could be waiting for it along the lines. If Evan would even want to sell, that is!

For some cooler insights on Evan’s Decision, check out: Why did Snapchat’s 23-year-old CEO reject a $3 billion buyout offer?

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