Snapchat Spurned $3 Billion Acquisition Offer from Facebook

[dfw1]

My guess is that Evan Spiegel didn't read the fast lane millionaire book. Probably was to high on his cloud of whatever... In fact I am certain of it. Now that his website got hacked and has compromised user info data of many, I'm pretty sure that his website traffic and user volume will go down. So my guess is that if someone or some entity offers you or whoever 3 or 4 BILLION dollars for something, regardless of its future potentials, its probably a dam good idea to take the offer!

 

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[benhebert]

I just watched this interview with Gary Vaynerchuk where he talks about Instagram selling to Facebook for $1bn. Basically, he thinks that they got a HUGE deal because they're purchasing the next generation of photo sharing users.

It's not the premise for the video, but still fantastic and worth listening to.

Gary Vaynerchuk 2013 Interview

 

[PopEmersen]

This is why they turned down 3 billion

http://www.theverge.com/2014/2/19/5427332/facebook-is-buying-whatsapp

 

[brandonrush]

This is why they turned down 3 billion

http://www.theverge.com/2014/2/19/5427332/facebook-is-buying-whatsapp

I don't understand. Snapchat turned down $3B so Facebook would offer more money to another company?

 

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[exige]

I don't understand. Snapchat turned down $3B so Facebook would offer more money to another company?

They are holding out for a similarly lucrative offer.

 

[brandonrush]

They are holding out for a similarly lucrative offer.

I believe their "similiarly lucrative offer" was the $3B one. Do you honestly believe Whatsapp is worth 1/3 of what Ford is? Really?

 

[exige]

I believe their "similiarly lucrative offer" was the $3B one. Do you honestly believe Whatsapp is worth 1/3 of what Ford is? Really?

Probably not, but I'm probably getting too old to understand it at this point. I didn't even know what Whatsapp was until I read this I looked at it, and I have no use for it. : shrug :

 

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[brandonrush]

Probably not, but I'm probably getting too old to understand it at this point. I didn't even know what Whatsapp was until I read this I looked at it, and I have no use for it. : shrug :

Same here. Never heard about it before this news hit today and I just can't wrap my head around a company not being a house hold name getting a $19B buyout. This social media bubble is nuts.

 

[Cyberseraph]

There are news about Snapchat: new $10 billion offer:

Take that, Facebook Inc. A year after rebuffing a $3 billion takeover proposal from Mark Zuckerberg, Snapchat Inc. is in talks to raise money from Alibaba Group Holding Ltd., people with knowledge of the matter said.

The valuation being considered is about $10 billion, more than three times what Facebook Chief Executive Officer Zuckerberg was willing to pay

Source: http://www.bloomberg.com/news/2014-...looks-smart-as-alibaba-weighs-investment.html

 

[SJVC]

Maybe we will have to eat our words...

Still, once you get past a certain point, how is an extra 1bn, 2bn or 3bn going to change your life?

 

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[Unknown]

I don't care how much they get in the end. Turning down $3 billion was stupid.

 

[RHL]

Software is trendy. Snap Chat isn't a fuel for cars or a cure for cancer, it almost certainly will not exist in 15 years. I would have taken the $3B, even if it meant losing more, the risk of your property decreasing in value year to year is incredible.

 

[AubreyJ]

SAD and GREEDY

http://www.forbes.com/sites/jeffber...worth-164-million-sold-to-betaworks-for-500k/

Pigs get fat, Hogs get slaughtered.

I didn't realize Digg was ever valued at 164 million, but for it to go to that valuation to a valuation of 500k in just 4 years is absolutely insane. I'd be kicking myself for the rest of my life if I was the CEO of Digg

Personally, I don't really get what the big deal is about snapchat- I use it, but only because almost all of my close friends use it, and it is a good way to send photos back and forth with my sister who lives in London. But I don't really get why it is so popular

 

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[tafy]

Personally, I don't really get what the big deal is about snapchat- I use it, but only because almost all of my close friends use it, and it is a good way to send photos back and forth with my sister who lives in London. But I don't really get why it is so popular

Because everyone uses it and its good, thats all you need to be very valuable

 

[Unknown]

Personally, I don't really get what the big deal is about snapchat- I use it, but only because almost all of my close friends use it, and it is a good way to send photos back and forth with my sister who lives in London. But I don't really get why it is so popular

I don't get it either. I'm still trying to figure out why people like Instagram so much.

 

[PopEmersen]

I don't care how much they get in the end. Turning down $3 billion was stupid.

Not if you get 10

 

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[Unknown]

Not if you get 10

That's like saying that hitting a 17 in blackjack was the right move because you ended up with a 21. It was still the wrong move. You just got lucky.

 

[PopEmersen]

That's like saying that hitting a 17 in blackjack was the right move because you ended up with a 21. It was still the wrong move. You just got lucky.

But this isn't luck of the draw gambling, this is an actual business that was created and followed a value creating process to lead to an event where they choose the outcome. You don't choose how much you win in gambling, that's luck. Creating a business and selling it is not luck.

 

[Unknown]

But this isn't luck of the draw gambling, this is an actual business that was created and followed a value creating process to lead to an event where they choose the outcome. You don't choose how much you win in gambling, that's luck. Creating a business and selling it is not luck.

Passing up $3 billion hoping to get more before people stop using your app and then getting more is pure luck.

 

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[PopEmersen]

Passing up $3 billion hoping to get more before people stop using your app and then getting more is pure luck.

How do you know he was hoping? He's the CEO of a growing intl platform, he's had VC funding for a while, i don't think its a stretch to say he knew his business was worth more than 3 billion to other parties. You're making it seem like the lottery which it isn't. It's a calculated decision by a business owner.

 

[Unknown]

This is pointless. I think I'm right, and you think you're right so there's no point debating it.

 

[Bouncing Soul]

There are news about Snapchat: new $10 billion offer:


Source: http://www.bloomberg.com/news/2014-...looks-smart-as-alibaba-weighs-investment.html

This is not an offer, it is the biz valuation created as part of their next round of funding.

 

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[tafy]

I'm still trying to figure out why people like Instagram so much.

When I first saw my wife using instagram and the amazing pics she was posting using their filters, I knew they had gold.

Need: People want to feel cool and post beautiful pics using their phone

 

[Rcaraway1989]

The Snapchat founders are incredibly close friends and they because popular even before they took on a single dollar of investment so they've had incredible leverage to choose the VCs they wanted. They got to hire incredible people they love. They had their HQ on Venice beach in LA and took the team surfing every saturday.

This isn't about "risk assessment" for them. They aren't selling because they've built an incredibly fun company and culture. They've struck gold with an idea they know they will never top working with people they know they would never be able to hire with a different company. They're living the life RIGHT NOW -- why would they give up control of that life to someone else?

 

[Angus]

Maybe we will have to eat our words...

Still, once you get past a certain point, how is an extra 1bn, 2bn or 3bn going to change your life?

how weak is that logic?
it's like saying you don't need squats if you deadlift and bench press. why would you train legs when your upper body is hot?

 

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[twdavis]

All I know is this: $3 billion?!?!?!?


Ok maybe he was thinking of other valuations in the future or that he could leverage the software better but to me when someone offers you $3 billion in CASH, you take it.


Like holy shit lol I would crap the biggest load in my pants if Mark Zuckerberg offered me $3 billion in CASH.

 

[twdavis]

Still, once you get past a certain point, how is an extra 1bn, 2bn or 3bn going to change your life?

Ummm..that's an extra 7 billion I'd have after I bought the Steelers.

lol.

 

[Simon Ashari]

I remember thinking the owners of twitter were idiots for turning down $500 million. As of me typing this, they have a $38.1b market cap. Not bad.

Obviously in this case, you want to sell as near the top as possible but before the bubble bursts (which it eventually will).

Companies with no revenues and limited options to create future revenue are not worth billions.

 

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[RogueInnovation]

This was my first thought

My second thought... seems to be delayed... because I haven't yet seen another reason why they turned it down.

Who knows though, maybe they love creating stuff and want to expand rather than start again.

 

[GuestUser113]

hmmm.... Zuckerberg turned down yahoo 1 billion acquisition offer in 2006.

I don't know what I could do with the money. I'd just start another social networking site. I kind of like the one I already have. Mark Zuckerberg