154: SNAP goes IPO and How You Too Can Build The Next SNAP
Good morning everyone my name is Chris Kalaboukis because I’m welcome to think future podcast well happy snap day people that’s right folks today is the second day of trading for Snap Chat or snap as the parent company of Snap Chat is known and yes folks we have entered a cognitive dissonance field we have a high flying I.P.O. This is like the first tech I.P.O. in a really long time and of course there’s pent up demand so everybody wants to jump in on it so it’s trading at something like with C. almost double its initial price it was originally set to go out at seventeen I think it’s about twenty twenty eight or something like that right now. Or the funny thing is about Snap Chat is that they don’t make any money they don’t make any money here’s an example or an interesting example of what I’ve mentioned before on the. Snap chat front or on the start up front on entrepreneur front is that nowadays. What’s important is not necessarily revenues what’s important is not necessarily revenues what’s important is. The interesting part about it is that this is something that. Has been going on forever it’s basically an intention based economy and it kind of brings into focus some of the other stuff I was talking about where the important thing is not making money but the important thing is raising an audience Snapchat has an incredibly huge incredibly in gauged audience and this incredibly huge incredibly gauge audience is only just now starting to be tapped with some type of monetize ation So what people are doing is they’re looking at they’re going to look at all the potential monetization even people who don’t. Understand snap chats appeal. Are buying into it now there’s a couple things here that are very interesting is that one. I mean in my perspective snap chat basically was created out of something that should be happening is kind of like what I was saying before about some of these companies who are now real mainstays out there today such as cable companies they all built their initial reputation in fact and I think one of the three main reasons why snap chat was being used at the very beginning was so that the high school kids could take pictures of each other’s test scores or test answers and send it to each other in class of the cheat on exams and everyone knows this snapshot is used a lot for sexting and other reasons like that and of course it came at the same convergence of where people were interested in making their. Activities on the Internet more private Here comes a photo sharing app and it really is a photo sharing app a photo sharing app which took all of the best elements of something like Instagram and then added the privacy element to it so that it really appealed to the fears of individuals who are thinking oh man this stuff’s going to go on the Internet is going to be there forever and now I don’t have to worry about it because it’s going to disappear so those two things and the fact that they could be used for illicit purposes propelled it into a huge user base and if you ask me I still can’t figure out how Snapchat is actually going to monetize but that doesn’t matter anymore and like I’ve said earlier in an earlier post Center earlier pod cast is that you know forget revenues forget cash forget money coming in Porton to investors anymore what seems to be important to investors anymore based on what’s happening with this I.P.O.. Is audience right the audience the potential audience is key if you’ve got so many millions of users then someone figures out well we’ve got all these users using this product. We’re Benchley begin to be able to figure out how to get people to pay for something on the product but that is people this is not how things operate anymore audience does not necessarily lead to. Monetization or audience doesn’t necessarily need to enough monetize ation an order for the company to survive I mean there’s plenty of examples of this of tons and tons of startups are littered in the. In the Graveyard of startups that had phenomenal phenomenal. Audiences huge audiences tons of users but then were free but once they started charging once they started asking people to pay they immediately dropped off because a competitor came along which was free and took their audience or somebody else or they never made enough they never turned enough people into paying customers to help them to survive now economies of scale when you figure there’s a huge if you have a huge huge audience and you have a not so huge cost to maintain the thing then maybe just maybe you’ll be able to convert enough of that audience into. Or at least run ads of hits or turn that turn that experience into something that zing gauging for the moment. And be able to survive and thrive but we’ll see if say like right now snap chat seems to me like a one trick pony right here’s here’s the concept and that’s all that they have in the question is how much longer. Will that continue to be important where some will someone else come along and do something differently it’s the same thing with foot Facebook Facebook is expanding Google expanding these are all these companies had this core vision I talked about this in an earlier show is that they have this articulated core vision and Snapchat has its articulated core vision but once it starts maturing a little bit long a little bit more and with any luck actually does monetize then they should have to expand their core vision and how do you expand the core vision of a company whose main stay is disappearing messages. It seems. Interesting to me. That anything that diverges from that core vision basically turns it into something very similar to what’s out there today so are people going to continue to flock to something like snap chat because it provides that core vision or are we going to see other things disappear you know we’re going to see disappearing e-mails are going to see disappearing videos or we’re going to see disappear I mean wow can help much further along can you expand that core vision. And not only that what’s also interesting is that there’s other I’ve read some things about some interesting psychological effects that are coming out of out of snapchat because it is more of a private medium and you’re having private conversations with people and when you have this ongoing conversation going and one of the parties drops off then what happens is just a very interesting. Event So we’ll see where it plays out but some people are looking at thinking Damn why couldn’t I have come up with that idea and I’ve said this before when snapchat started getting popular is that a lot of the reasons that Snapchat is popular is because it’s sort of a Black Swan It came at the right moment where there was a kind convergence of. Privacy concerns and photo sharing app photo sharing app some privacy concerns came together at the exact same moment to create Snap Chat so people are looking at then go how can I do that success how can I do the exact same thing as snapchat and build my own multibillion dollar business and the reality is that you can’t look at snapchat and say well I’m an exact same thing what you have to do and I’ve talked about this before is try to sense the trends that are occurring out there in the real world try to do some foresight and figure out where these trends are going and then when you see these trends look at intersecting these trends and building a service in the intersection of the trends and when you build a service in the intersection of the trends there’s a better chance that this thing might take off and that’s exactly what Snapchat did they built in business in the intersection of the trend between privacy and photo sharing apps and it turned into a huge deal so my advice to you if you’re looking to build something like snap chat then look at that look at the trends that are happening out there look at chat bots look at AI look at V R look at a our look at all the various trends the Internet of Things look at all the various trends that are out there all the social logical trends not just of technological trends the social logical trends the economic trends the gig economy there’s all these different trends that are out there take the trends that you see and mash two or three of them up and build your product in that intersection of those trends and maybe you’ll end up with the next snapshot that’s it for me for today see you next time until end don’t forget to think future.