Snapchat Stock Surges 44 Percent On The First Day Of Launch

Snap, the parent company of SnapChat, had a great run on its first day at the New York Stock Exchange. The issue was launched at the value of $17, but opened at $24 and closed at $24.48, which is a net rise of 44 percent straight. However, the IPO price was not accessible to everyone but limited to high net worth investors and institutional buyers. Many of the investors rooting for Snap didn’t have the chance to invest in the IPO because of low accessibility. It resulted in many of the investors not able to make enough returns from their investment after the launch.

 

The launch of Snap’s IPO looks pretty similar to that of the launch of Twitter’s IPO launch in 2013. The Twitter’s IPO launched with much fanfare and saw a massive surge on the first day, but faced volatility in the month’s to come. Alternatively, Facebook didn’t witness such a surge on its opening day but strengthened its position over a period in the stock market. The move of Snap going public is considered an exciting turning point for the company. It is because the company didn’t want to be hyped as overvalued, which is mostly the case with online companies.

 

It is true that SnapChat is entering the market a bit too late, but it would prove worthy for the enterprise. It is because its attractive feature of “Stories” being copied by other modern applications like Instagram and now, even Whatsapp. Even though the revenue of the company has been significantly increasing, the income doesn’t generate considerable net profit. Hemant Taneja, one of the first few investors in SnapChat says that he believed in SnapChat and its Founder, Evan Spiegel because Evan was hell bent on making the technology generate interest, create volume regarding member base and overall, make it work, and he did. He added that the founder wanted to keep the primary elements of the app same, rather than always changing the behaviors.

 

The images in SnapChat disappear by default, and while many were skeptical about it in the beginning, it proved to be a feature that is quite popular till date.

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