Snap Inc., the company formerly known as Snapchat, is reportedly preparing for an initial public offering that could happen as soon as March of next year.
The maker of the popular visual messaging app is busy preparing the paperwork for an IPO that could value the company at $25 billion, according to The Wall Street Journal. That’s significantly higher than Snap’s most recent valuation, which was estimated to be approximately $17.8 billion in the wake of a $1.8 billion funding round in May.
If that estimate turns out to be accurate, it would make Snap the biggest company to go public on the U.S. exchange since 2014, when Chinese e-commerce giant Alibaba Group Holding Ltd. debuted at $168 billion.
“We aren’t commenting on rumors or speculation regarding any financing plans,” a spokesperson for Snap Inc. told Digital Trends. Snap has never denied plans to go public. Last year, the company’s CEO Evan Spiegel confirmed an IPO was on the cards, referring to it as “another dot on the list of things to do.”
That list has grown ever longer thanks to the company’s expansion into hardware, courtesy of its new video-recording sunglasses” “Spectacles,” due out in the fall. With that announcement came the rebranding of the firm, from Snapchat (which remains the name of its flagship app) to Snap.
Additionally, it has been aggressively expanding its ad API (application programming interface) allowing marketers to create optimized content that auto-plays in-between its users’ stories — the main social sharing format pioneered by the platform. Behavioural targeting capabilities that will see users targeted with ads based on their in-app activity are also being rolled out.
The company dropped a major indication of a possible IPO last month when it secured a credit line with a number of banks, including Morgan Stanley, boosting its spending power as a result. Comparatively speaking, Facebook (a company Snapchat may be trying to emulate with its expansion beyond it roots as a social platform and into hardware) made the same move ahead of its IPO in 2012.
Thanks to burgeoning double-digit growth, which is set to continue next year, the Snapchat app is expected to accumulate 217 million daily users by the end of 2017. Snap’s predicted revenue for next year is $1 billion, compared to approximately $300 million this year. Not too bad for a company Facebook tried to snap up for a paltry $3 billion in 2014.