With 350M messages sent a day, Snapchat explores how to make money

Above: Snapchat chief executive Evan Spiegel

Image Credit: Jolie O'Dell/VentureBeat
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SAN FRANCISCO — Snapchat sends 350 million self-destructing messages a day.

Snapchat’s founder Evan Spiegel said at TechCrunch Disrupt today that the company’s userbase is growing rapidly and is attracting an increasingly broad range of users.

“I was just snapping my mom this morning,” Spiegal said. “We’re growing across every demo graphic from 30 year olds at the airport to 16 year olds at the mall.”

Snapchat is a mobile application where you can send photos to your friends that will disappear in 10 seconds. Less than six months ago, Snapchat was sending 150 million messages a day. That number has since soared, and Spiegel said the company is exploring the possibilities for in-app purchases, so it can actually make money off its massive audience.

“We’ve been thinking a lot about the future of the product,” he said. “We are a business, and we want to make money, but the way we think about monetization has changed. We’ve looked to Tencent [an Internet portal], which makes the vast majority of their revenue from in-app transactions. They had to build things that people wanted to buy. That’s a really scary challenge, to make things that people want.”

Spiegel did not offer a timeline on monetization but said he hopes Snapchat will make revenue before the next time it seeks funding. The company raised a $60 million “scaling round” in June to build its server infrastructure and hire new engineers.

This is an impressive amount for a company that has yet to earn a cent, but the investors were impressed by the viral-growth and high-levels of engagement. Instagram — a fellow social application that didn’t make money but had millions upon millions of users — sold to Facebook for $1 billion.

Spiegel said the fundamental premise of Snapchat is that the messages delete. In an era where everything we do online can be stored and tracked, the appeal of Snapchat is in its ephemerality. However, the lack of a lasting record can invite mischief and people always joke about Snapchat and “sexting.”

Spiegel, however, said Snapchat is better used for other purposes.

“Snapchat is not a great way to share photos you want to keep private because people can take screenshots,” he said.
“We can’t prevent that. It’s not a great way to send elicit pictures. Snapchat is more about sharing the moment.”

More information:

Snapchat is a photo messaging application developed by four Stanford students. Using the app, users can take photos, record videos, add text and drawings, and send them to a controlled list of recipients. Users set a time limit for how... read more »

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