Hint: China.
Snap Inc’s IPO valuation has been big on the news. It is already worth more than 9 of the largest companies in the world. And let’s take a step back to realise that Snap Inc. produced an app mostly catered to millennials to document their lives incessantly to their friends with filters that we are can’t stop applauding. In this series of comparison, we will use the market capitalisation values.
To give a rough indication of what Snap Inc is worth now, we will use Techcrunch’s original article to showcase the magnitude of their value.
Snap Inc.’s IPO value is at $24.51 billion and a market cap value at $34 billion. This easily puts Snap Inc. above some of the most matured and pioneered companies in the world. Some of which includes Ferrari, which has a market cap value of $12.46 billion and Hilton, which has a market cap value of $19.18 billion. While these companies don’t produce a compelling and convincing comparison given the different purposes, its maturity in the market should give a rough indication of Snap Inc.’s market strength.
The Tech Giants
Twitter, which many of us have already seen or know of their decline, is one of the prime examples to compare the surge of excitement for Snap Inc.’s IPO. Twitter is has a market cap of $11.20 billion now — about half of Snap Inc.’s initial IPO. Its IPO opened with a valuation of $24.46 billion, not very far from Snap Inc.’s. Many have already presume the overly-blown valuation of Snap Inc. and described it to be on a slowburn to its fall, just as Twitter did.
Facebook, on the other hand is doing better than ever. According to CNBC, Facebook comes in as the 5th largest publicly listed companies with a valuation of $398.33 billion. Alphabet Inc., who owns Google, is 2nd on the chart with a market cap value of $560.7 billion.
Somewhere in China
What we have been focusing on these days are the big companies and tech giants internationally. What many of us have left out are the big heads in China.
The Hidden Behemoth: Tencent
Tencent, the leader of China’s social media site comes close to Facebook’s market value! Its current market valuation is an estimated $254 billion. Given the size of Tencent and its market share compared to say Facebook and Alphabet Inc., Tencent is doing a pretty decent job despite their limited and smaller targeted reach.
Tencent is home to most of China’s tech and social media sites. We are no stranger to Wechat. And before that, QQ was a thing. Admit it or not, a lot of the features Facebook seem to be launching recently has already been entrenched deeply in Wechat. For instance, the new paying systems through Messenger launched recently is already well-known and utilised in Wechat.
Revenue wise, Tencent is raking in more than Facebook. According to stats from Business Insider, Facebook’s revenue amount to $11.82 billion with Tencent made a total revenue of $10.21 billion.
The Hidden Behemoth in Crime, Alibaba
Another huge tech giant that everyone knows of is Alibaba. Their market cap comes near to that of Tencent at $255.12 billion. Jack Ma, the second richest man in China hones one of the largest e-commerce sites in the world. A quick and ubiquitous comparison to Ebay will allow you to understand the enormity of their market share. eBay’s market capitalisation is at $36.8 billion. This is about 6 times lesser than that of Alibaba.
And of course, Alibaba is making bigger bucks than that of eBay. Alibaba has in fact, become the largest retailer in 2016. Their revenue for 2016 amounts to $14.6 billion which is doubled that of eBay at $8.97 billion.
So, the next time someone mentions the success of Facebook and Amazon, you can go beat imperialism and remind them the astounding success of these Chinese tech giants. And also, time to for us to brush up on our Chinese.