How Snap’s Market Debut Compared With the IPOs of Twitter, Facebook

The two execs will retain control over all shareholder decisions for Snap – and investors buying stock in the IPO don’t have voting rights at all.

When they’re first offered, IPO stock is priced to sell: The goal is to name a price that investors will find attractive (i.e., one that’s “low” enough).

Snapchat’s owner Snap Inc has worked on a drone that could help users take overhead videos and photographs and then feed that visual data to the company, the New York Times reported on Tuesday.

Secretive Snap co-founder Evan Spiegel, who usually favours sweats or a button-down shirt, showed up to the floor of the exchange in a suit and tie to ring the opening bell before leaving the building to watch festivities away from the spotlight he famously avoids. However, revenues in the same time period also increased substantially, with $404 million generated in 2016, as compared to $59 million in 2015.

That means the social network once thought of mostly as a tool for sending naughty pictures is now worth about US$28 billion – more than Macy’s and American Airlines as of Thursday.

But those same investors smell the possibility of another Facebook rather than a Twitter; there hasn’t been a big new technology flotation for more than three years and markets are in an optimistic mood. User numbers are far below Facebook’s billion plus but the average user is younger and spends about 30 minutes a day on the service. At that valuation, Snap would be the biggest USA -listed IPO since Alibaba Group Holding Ltd. debuted in 2014, . Co-founders and majority holders Spiegel and Murphy will be responsible for the decisions that lead to Snap’s success-or on the hook for its mistakes.

Its advertising model is still evolving, with many brands using the platform to experiment with one-off campaigns before committing to longer term spending. Spiegel will also receive a bonus equivalent to 3 percent of its market capitalization or up to $669 million.

That’s a remarkable open since new issues typically see a lot of see-sawing on the first day as investors weigh demand for the stock against the company’s actual business. The year before Twitter’s IPO, it lost $79 million, while Facebook made $1 billion.

Over the course of the day, Snap sold 200 million shares of stock, raking in .4 billion in the process. Twitter, which only reports monthly active users, had 218 million when it went public. Plus, the growth of its users is slowing, thanks to competition from established competitors.