According to sources, the Snapchat app has confidentially filed for an initial public offering (IPO) with the US Securities and Exchange Commission (SEC). This has put the California-based company one step ahead in making it one of the biggest technology offerings.
In accordance with the Jumpstart Our Business Startups Act in the US, companies that value less than one billion dollars in revenue can file for an IPO. This allows them to test the investor appetite quietly while ensuring that the financials remain confidential.
However, this information is highly confidential and the spokesperson for Snapchat’s parent company has refused to comment on this matter.
In 2012, Snapchat started off as a free mobile app that allows users to send and receive images that disappear within seconds. There are over one million active users of this app and nearly 60% of the users belong to the age group 13 to 24. So, there’s a pretty young crowd out there everyone wants to reach out to with their advertisements.
Despite its far reaching success, the investors of Snapchat worry because the company’s only major source of earning revenue is advertising sales.
Recently, the company has ventured into something new and it launched video-camera sunglasses for $130. These sunglasses are wirelessly connected to smartphones and they can take images and videos with great ease.