Snapchat is roaring ahead as the new social media trend

IT WAS hatched as a Stanford University design project barely two years ago.

But now Snapchat, the photo-sharing app which allows users to send images which "self-destruct" within ten seconds, is taking a bite out of Facebook after its valuation soared to $800 million.

The service offered by Evan Spiegel, 22 and Bobby Murphy, 24, the latest darlings of the start-up social media sector, is intentionally fleeting.

Smartphone users send photos or video clips to friends which disappear within ten seconds or less after being viewed, and are supposedly then deleted from servers.

Launched in 2011, teenagers immediately embraced the app as a fun new way to communicate, without leaving a trail of personal information. More than 200 million images are "snapped" globally each day, up from 60 million in February.

The app's "hyper-growth" rate has been compared to the early days of Twitter and Instagram, with users moving beyond the temptation to send sexually explicit images to carefully selected targets.

Whilst Snapchat deals in the ephemeral, the entrepreneurs behind the app are attracting heavyweight backing, despite the start-up having yet to demonstrate a profitable business plan.

Snapchat has raised $60m in its latest round of funding from Institutional Venture Partners, General Catalyst Partners and SV Angel. Michael Lynton, chief executive of Sony Corp US and Sony Pictures Entertainment, will join its board.

With $13.5m of venture capital backing previously secured in February, analysts said Snapchat was now valued at around $800 million, up from $60 million (£39 million) earlier this year.

Mark Zuckerberg, the Facebook founder, is among Snapchat's millions of users. But when Facebook launched a rival disappearing photo-messaging service, Poke, it failed to make a dent in Snapchat, which increased its market share.

Snapchat now has a higher valuation than the $715 million which Facebook paid in cash and stock to acquire the image-sharing service Instagram, which is used to transmit 40 million pictures a day.

Spiegel and Murphy, Stanford "frat boys", developed Snapchat in response to a series of US scandals over politicians caught "sexting". "What if embarrassing photos could instantly expire once viewed?", they asked.

Fellow students weren't impressed with the model the pair presented in a design class so Spiegel quit school two years ago and worked on the app from the dining room of his father's house in Los Angeles.

Rejecting Silicon Valley as a base, the pair located Snapchat, which currently employs 17 staff, in a beach house on Venice Beach, its premises marked by a yellow cartoon ghost on the door.

Just as Facebook's contested origins became the subject of a film, The Social Network, Snapchat's founders now face a legal battle.

In February, former classmate Frank Reginald Brown IV filed a lawsuit against Snapchat and its co-founders, alleging that he came up with the idea and worked on the app but was frozen out after falling out with his friends. The company has declined to comment on the lawsuit.

Snapchat now needs to monetise its operation, through in-app purchases and mobile advertising.

Spiegel, who still lives at home with his father, an entertainment lawyer, said: "We've been able to support the growth of Snapchat with minimal overhead. But in order to continue scaling while developing the Snapchat experience, we needed to build a bigger engineering team and figure out how to pay our server bills."

Snapchat is worth its $800 million valuation, argued Dennis Phelps, general partner at Institutional Venture Partners. "Snapchat is clearly a huge success, and we wouldn't have invested unless we believed that it will become a much larger one," he said.

Spiegel has hired the best engineers in the country and aspires to make Snapchat a "multi-billion dollar venture-backed success", Phelps said.

Snapchat would outgrow its teen audience, Phelps predicted. "Facebook spread like wildfire across college campuses long before it gained acceptance with soccer moms," he said.

Snapchat was unique because it offered a "sense of excitement and an urgency of consumption that is rare in this era of information overload," argued Phelps.

Privacy campaigners have warned that images sent through Snapchat may have more permanence than their senders intended. Screen shots can be taken of any image sent through the app, and senders are notified when a recipient does so. The company acknowledged that material deleted from its servers could be recovered "using the right forensic tools".

MTV is using Snapchat to send "cheeky" pictures from the new series of reality show Geordie Shore directly to fans' smartphones, in a marketing tie-in.

Snapchat claims that lewd images form a very small amount of the material shared through the app.


Eight years and 900 million users after Mark Zuckerberg and Harvard buddies created social network, Facebook went public in 2012 with $104bn (£66bn). Bungled offering saw stock lose half of its value three months later.


Farmville social gaming platform founded by Mark Pincus earning $829 million in sales hit peak valuation of $12 billion and went public in 2011. Market capitalisation slumped to $2 billion after customer move away from Facebook games and disastrous $200 million purchase of OMGPOP gaming company.


Micro-blogging service founded by NYU student Jack Dorsey in 2006 now has more than 550 million users and projected to earn $400 million in advertising revenue. Expected to launch IPO next year with valuation at $11 billion.


"Virtual pinboard" website that allows people to group images in themes launched in 2010 now has 50 million users and valuation of $2.5 billion after $100 million investment round. Co-founded by former Google employee Ben Silbermann.


Created by San Francisco developers Kevin Systrom and Mike Krieger and launched in October 2010, photo and video sharing service was adopted by celebrities and purchased by Facebook in 2012 for $715 million in cash and stock. Currently has 130 million users.

Topics:  business photos snapchat social media technology

VIDEO: Step inside Rocky's newest shopping centre

NEARLY OPEN: AHC Limited Managing Director Rod MacLeod and Cr Rose Swadling outside the new Woolworths store.

Countdown is on for Parkhurst Town Centre opening

Dreamworld boss breaks silence with message to family

Deborah Thomas faced the media today after the AGM.

"I am a mother, I have a family. I take my family to Dreamworld."

WATCH: PM says closing health gap is 'very high priority'

L-R Prime Minister Malcolm Turnbull and Deputy Prime Minister Barnaby Joyce tour a farm on the outskirts of Rockhampton to talk about infrastructure spending including the proposed Rookwood Weir.

Prime Minister Malcolm Turnbull, on what he will do for us

Local Partners

Local march is helping women 'Reclaim the Night'

Sexual violence is being brought out of the shadows this weekend with a march planned to raise awareness.

WATCH: NASA space station is live, see the view from above

In this picture taken from NASA's International Space Station from April 2015, the SpaceX Dragon is captured with the 57.7-foot-long Canadarm2 robotic arm before its installation to the Harmony module.

See the world from a new perspective as space station passes Rocky

LISTEN: Headbangers Halloween Hellfest lineup for Rocky gig

LEGENDARY: Odysseus Reborn hail from Bundaberg and will play the Headbangers Halloween Hellfest on October 29.

Four bands on the bill for metal core music gig this Friday night

Program announced for weekend's film festival

Lead character Frankie in one of the Capricorn Film Festival's short films, Slingshot, to screen this weekend.

Over 20 short films by CQ filmmakers to screen this weekend

Buy your own brothel: Scarlet Harem for sale

OPPORTUNITY KNOCKS: The Coast's first brothel, Scarlet Harem at Kunda Park, is up for sale.

Coast brothel madam sells up

Tom Cruise credits success to Scientology

Tom Cruise

Tom Cruise credits his success to Scientology

ADFAS lecture on UK's greatest gardener

FINE ART: Lancelot "Capability" Brown.

Australian Decorative and Fine Arts Society welcomes lecturer

High School sell-out evening

MEANINGFUL CREATIONS: Rockhampton State High Schools will perform their first Drama and Dance Showcase tonight, after it sold out in just eight days.

High School drama and dance showcase a sell-out event

Females are funnier in play

Rockhampton Little Theatre's cast rehearse for their production, Female of the Species.

Rockhampton Little Theatre's latest performance

Hacksaw Ridge leads AACTA Awards nominations

Andrew Garfield and Teresa Palmer in a scene from the movie Hacksaw Ridge.

MEL Gibson's wartime drama opens in cinemas next week.

Coast biggest rental drop in Qld

Vacancy rates for the September quarter.

Vacancy rates on Coast a promising sign

Tough times in CBD: Woolies says goodbye Ipswich

Woolworths in the Ipswich Mall.Photo: Rob Williams / The Queensland Times

The last day of trading will be January 1

Low rent helps teen get ahead

Yeppoon Real Estate principal and owner Esme Coren at one of their rental properties in Yeppoon.

Low rent great for tenant, not for owner

Look at me! Kath and Kim home up for sale

Kath and Kim from the iconic Aussie TV series.

'Crack open the Baileys and grab a box of BBQ Shapes'

How to fit 100,000 new homes on the Coast

Property, real estate, housing, suburb,  August 2016

Fitting 2m extra people in south-east Qld in 25 years a balance

Hinterland horse stud passed in for $8.25 million

UNREAL: This Maleny estate is incredible.

12-bedroom hinterland horse stud still available