SNAPCHAT IPO CREATES NEW BILLIONAIRES

The parent company of Snapchat saw its share price close at $24.48 on its first day of trading on the NYSE, making it the largest tech IPO since Alibaba went public in 2014.

Shares of Snap opened at $24, seven bucks above the IPO price of $17, which gave it a valuation of $33b. That means the app is worth about as much as Target.

More than 200m shares of the stock were sold today, which started at $24 a share, 41% above its IPO offering of $17. It rose as high as $26.05, according to FactSet, and dipped to $23.50.

Besides the two co-founders, the IPO put bags of cash into the coffers of Snapchat’s early funders, Lightspeed Venture Partners and Benchmark.

The Wall Street Journal reported that Lightspeed turned $8m into $1.5b; Benchmark’s $24m stake is now $2.2b.

Based on the $17 a share IPO, Snap’s valuation when it started trading at 11:30am ET was $23.6b. Contrast that with Facebook’s valuation the day it went public in May 2012: $81.2b. It is now valued at $395b.

Snapchat boasts 158m daily active users, most of whom are in the demographic sweet spot, people in their teens, 20s and early 30s. The company lost $515m last year.

There could be a strategic reason the service pushed the button now.

Audience growth on Snapchat has been slipping in recent months—a trend that began when Facebook's Instagram debuted its Stories feature, which completely mirrors the functionality of Snapchat, in August.

The slowdown is measurable—from 36m daily active users during the first half of last year before Instagram made the change, to just 15m in the second half.

But expect Snapchat, which relies more on pictures, filters and camera video than it does words like Facebook and Twitter, to pivot toward its strengths. CEO Evan Spiegel has called Snap a "camera company," and included that description in its IPO documents.

Said Lyor Cohen, “I am so happy I left the most successful company in the music biz, The 300, to join Snapchat as their global head of music. I am eternally grateful to my friend Eric Schimit for this opportunity.”