Of course, Snapchat hasn't built up the number of users that Facebook Inc (FB - Get Report) and Twitter can boast, but it has achieved a dedicated following in a very short period of time. The site takes one of the most popular aspects of Facebook, sharing photos, and then ensures that this remains private between oneself and only the approved few that you wish to see them. This is a nifty idea that has particularly found favor with women, with the company recently confirming that 70% of the Snapchat user base is believed to be female.
SnapChat Facebook’s worst rival?
As aforementioned in this article, it was highly likely that the big guns in the social media sphere would keep abreast with developments related to Snapchat, but this was confirmed beyond all doubt when Facebook Inc (FB - Get Report) decided that this was one rival it wished to eliminate from the marketplace. Thus, Evan Spiegel, Snapchat’s 23-year-old co-founder and chief executive, was presented with an offer than many of us wouldn't mind receiving; a $3 billion buyout offer from Facebook.
In the manner of the most idealistic and ambitious young entrepreneur, Spiegel rejected this offer, obviously considering that the market value of the company was potentially many times that, or at the very least considerably more than that which had been offered. This is a pretty confident act considering they haven't seemingly generated any revenue yet.
This has been a massive problem for all companies in this high-profile sector. Rarely have there been a collection of companies which are such obvious household names, which attract ten-digit valuations, which attract millions, and indeed billions, of users, yet don't make any profit.