One of the most upcoming apps in today’s world, Snapchat, has turned down an offer from Facebook worth $3bn, for Co-founder and CEO Evan Spiegel’s young firm. Two years ago, when Evan and his Stanford classmates decided to create the next renowned instant messaging app, they initially decided to name it “Picaboo”; however towards the launch, they renamed it to Snapchat.

The $860 million dollar company believes its worth more than what Facebook offered and with new ideas of raising revenue such as paid services within the app; it could potentially raise large sums of revenue. One of the main reasons why they believe they can gain large sums of revenue is simply because of its large customer base. The apps main demographic is users between 13 and 23 years of age and recent studies show that more than 45% of the people with smartphones use Snapchat.

Could Snapchat be worth more than $3 billion in the coming future? Could the net present value of $3 billion be less than what Snapchat would be worth in the future? If Snapchat’s value proposition of introducing paid services within the app is successful, they could potentially be worth more in the future.

Source:

http://www.independent.co.uk/life-style/gadgets-and-tech/news/the-23yearold-snapchat-cofounder-and-ceo-who-said-no-to-a-3bn-offer-from-facebook-8940433.html