Snap’s high-priced IPO rakes in cash for big acquisitions
Most of Snaps top products came from acquisitions, and now it will have the war chest to make more. Yet it didnt have to blow its momentum to collect this cash. After pricing its IPO at $17, above its original $14 to $16 range, today itsshares popped over 40 percent to start trading at $24. That means it pocketed $3.4 billion while still looking cool and confident on the public markets. Sure, the 40 percent pop means it could have priced even higher. A huge windfall of nearly a billion dollars will go to its IPO underwriters the big banks like Goldman Sachs that pre-bought Snaps shares. But having its stocks price go up on Day One is critical to the companys brand that hinges on being trendy. Now that its public, Snap can refocus on advancing its product, which its repeatedly done successfully through acquisitions. The most well-known Snapchat feature, its selfie Lenses that let you puke rainbows or look like a puppy, came out of an acquisition. Snap acquired Looksery (left) to power its selfie Lenses (right) Heres a look at the companies Snap has bought and what they turned into: While Snap doesnt have the cash to buy out other tech giants, like when Facebook paid $19 billion for WhatsApp, it has enough money to make more pioneering technology purchases.
Read Full Article at https://techcrunch.com/2017/03/02/snapquisition/
Tags: acquisition, companys, doesnt, facebook, feature, looksery, momentum, percent, product, refocus, selfie, technology