Peter Kafka

Recent Posts by Peter Kafka

The Idiot’s Guide to Valuing Snapchat

crystal ball shutterstock everett collectionHow do you put a value on Snapchat?

I’m no expert! But I do have access to a keyboard, and you’re reading, so I’ll keep typing.

The way I figure it: Snapchat is worth a lot to Facebook, which is worried that it has gone from the most popular kid in high school to Wooderson; it is probably worth the same to Google, which is also worried, with good reason, that it isn’t cool, either. It is also worth a bunch to an Asian investor like Tencent that likes the idea of owning all or part of a big U.S.-based Web company.

And to everyone else, who might reasonably conclude that it is a teen-centric fad with little hope of generating significant revenue, let alone a profit, before it evaporates, it’s worth next to nothing.

Precise, right? But that’s why you’re paying top dollar for this analysis.

Bonus tip: Do not, under any circumstance, pay attention to this moron, who confidently explained in 2008 that:

  • MySpace was worth $5 billion,
  • “No one [besides Microsoft] actually believes Facebook is worth $15 billion,”
  • and AOL may have gotten Bebo for a steal when it paid $850 million.

Seriously. If that guy is still typing somewhere, take his keyboard away.

(Image courtesy of Shutterstock / Everett Collection)

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