Snapchat parent files to go public on the New York Stock Exchange

Snapchat, which was launched in 2011 to allow users be casual and raw in the disappearing photos, is going public and it's going to be listed on the New York Stock Exchange as “SNAP.”

The company is said to be valued at $20 billion to $25 billion and is looking to raise $3 billion in the offering. Notably, Alibaba raised $22 billion in 2014 and Facebook raised $16 billion in 2012.

According to the reports, Snap plans to use proceeds from the offering for general corporate purposes, which may include acquisitions, the filing with the Securities and Exchange Commission shows.

With 161 million daily active users, Snapchat was once considered as a sexting app. Now, with its rapid development, it is clearly much more than that. The company said in its filing, "In the way that the flashing cursor became the starting point for most products on desktop computers, we believe that the camera screen will be the starting point for most products on smartphones. This means that we are willing to take risks in an attempt to create innovative and different camera products that are better able to reflect and improve our life experiences."

The company also posted $404.5 million in sales in 2016, beating analysts’ expectation of $350 million in revenue. Though this figure is impressive, Snapchat is finding it hard to find a foot space in direct competition with Facebook-owned Instagram. According to TechCrunch, Snapchat's growth has slowed down 82 percent after Instagram launched its Stories platform.

In Q1 2016, Snapchat raked in 122 million daily active users with 14 percent growth over the past quarter. With Q2, Snapchat hit 143 million daily users with 17.2 percent growth rate, which was its best growth quarter ever.

On August 2nd, entered Instagram Stories, which was an exact clone of Snapchat Stories. While Instagram was growing exuberantly, Snapchat rose just 7 percent in Q3 2016 to reach 153 million daily users, which was its lowest percentage growth quarter since 2014.

In Q4, while Instagram Stories reached 150 million daily users, Snapchat's growth rate was only 3.2 percent. According to the report, this figure means Snapchat was growing at just one-fifth of the speed it was two-quarters earlier.

The company also admitted in its IPO filing’s risk factors that “We face significant competition in almost every aspect of our business both domestically and internationally. For example, Instagram, a subsidiary of Facebook, recently introduced a “stories” feature that mostly mimics our Stories feature and may be directly competitive.”

Apart from Instagram Stories, Snow, the South-Korean app was also named to be the cause of its slow growth rate. Snap also listed "technical issues as hindering growth at the end of Q3 2016."

Stay with us for further updates on both the companies.