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Snapchat's Business Model Evolution

   

Added on  2020-05-04

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Running Head: New Business ModelSnapchatNew Business Model
Snapchat's Business Model Evolution_1

New Business ModelP a g e | 1IntroductionSnapchat is an American technology and social media company founded on September 2011by Evan Spigel and Bobby Murphy in Venice. The company currently has 4 in house productsnamely: Snapchat, Spectacles, and Bitmoji & Zenly. The company has been in discussion since its inception. The company was initially founded as a camera company, due to its gaining popularity; it earned its reputation as a social media company, giving companies like instagram, Facebook and watsapp a run for its money. Mark Zuckerberg, Founder & CEO of Facebook wanted to acquire Snapchat, but the owners were aware of its popularity and thus declined the offer at a very nascent stage. Since then, the company has been just gaining uncontested popularity, forcing many social media giants to follow footsteps of snapchat.1From Capital to Value design:Snapchat was funded by Bridge funding and light speed ventures as seed funding, post that the company raised some $ 13.5 MN in Series a funding round which made the valuation of the company to $ 70 MN. By 2016 the company has completed 4 rounds of funding at was sitting at a figure of $ 1.2 Billion. Facebook at that time offered Snapchat $ 3 Billion, it was a good amount, considering the valuation, but the owners denied it and now they are sitting at a valuation of $ 22 Billion. The company never showed the signs of defeat or giving up to the pressures of Silicon Valley and are going strong with 173 Million daily active users. The owners believed in the business model and its target audience, they knew with the positioning, they are sure to succeed, and money will come eventually, this led them to work on value designing and move forward from capital.2From Value chain to network:1 Vaterlaus, J.M., Barnett, K., Roche, C. and Young, J.A., 2016. “Snapchat is more personal”: An exploratory study on Snapchat behaviors and young adult interpersonal relationships.Computers in Human Behavior,62, pp.594-601.2 Billings, A.C., Qiao, F., Conlin, L. and Nie, T., 2017. Permanently desiring the temporary? Snapchat, social media, and the shifting motivations of sports fans.Communication & Sport,5(1), pp.10-26.
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