Snapchat has raised over 1.8 billion in its latest funding round. Leaked documents explain that tremendous revenue growth is expected for this popular video messaging application within the next two years. Documents show that Snapchat has the potential of reaching $1 billion in revenue by 2017.
On May 26th, filings that were divulged by an SEC report that the app’s latest funding round came in at a total of $1,808,560,006. An investment of $175 million by Fidelity Investments in February is a part of the funding round.
Although the SEC documents fail to disclose at what valuation Snapchat raised the money, sources informed TechCrunch that the investments could have been made at valuations ranging from $17.5 billion all the way up to $22.7 billion, the app’s maximum valuation.
An investor who declined to participate in the Series F round also provided TechCrunch with a presentation deck which exposes details on the user numbers and revenue of Snapchat. The leaked slides show that Snapchat earned almost $59 million in 2015. The majority of these earnings came in the final two quarters as the application increased its efforts to make money from its growing base of users.
Snapchat believes that in 2016, the company has the potential to generate between $250 million and $350 million. In 2017, the app predicts to earn between $500 million and $1 billion. The higher end of these estimates are based on company sales targets rather than internal revenue figures.
Deals with big names in the media space that will take advantage of the app’s popularity with younger users is outdoing any of Facebook’s attempts to grow its revenue. However, it is important to note that Snapchat has no way of gaining access to customer data, making the app function more like a television network rather than a social network.
According to the leaked slides, as of December 2015, 110 million daily active users were on Snapchat. This is a 74 million increase from the previous year. The slides also revealed that North America was the bulk of the app’s user base.