News & Views
Snap is almost definitely not the next Facebook

Snap Inc., the parent company of Snapchat, is making its Spectacle device available to buy online in the United States, ahead of its IPO. Hype has surrounded the wearable camera due to its elusiveness; it could only be obtained via roaming pop-ups in cities across the country.

Industry analysts believe that releasing Spectacles to a wider audience (while still limiting purchases to six per household) will be “helpful” in the lead-up to the company’s IPO. Ben Wood of CCS Insight tells the BBC that this move has “given them opportunity to ramp up volume and refine the product, before launching a bigger distribution online with more confidence.”

Far from being a pretender to the throne of social media sovereign Facebook,  Snap is reimagining itself as a camera company, as this push on hardware indicates. “If the Spectacles are successful, it will help position Snap as a camera company, which is a key pillar of their business,” says Wood. “They’re perceived as a fun product, which helps resonate that Snap is trying to offer something different to Facebook. It adds diversity to its business.”

Next to the infamously lofty mission statements of other Silicon Valley companies, Snap’s new focus on perfecting a 200 year old invention comes across as simply “unambitious” and “unsexy” according to financial writer John McDuling. Facebook and Google’s goals of making the world a better, more-connected place give them more room to fail, but regardless of whether that shows hubris or vision, it appeals to investors.

That said, hedging its bets and steering away from steep competition in social might not be the worst idea in the world for Snap. While Snapchat’s user numbers remain strong, it is now forced to share eyeballs with Instagram, after the Facebook-owned image-sharing platform introduced its Snapchat-inspired ephemeral content feature. And now Whatsapp, another Facebook company, will soon be rolling out its own Stories feature.

The Snap, Inc. IPO is shaping up to be one of the most hotly anticipated of the decade, once again inviting comparison with Facebook, which went public in 2012 — although Snap’s is unique in that shareholders will not be offered voting power, which has some commentators uneasy.  “If there was ever an IPO to avoid, this one is it,” writes Timothy Green at Newsweek. “A euphoric valuation, a completely unproven business model, and a structure that gives ordinary shareholders no voting rights at all…invest at your own peril.”

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