When Snapchat was valued at $10 billion less than a month ago, it made headlines. Why? Because having produced zero revenue and lacking even a basic business model, it was somehow worth more than Dunkin’ Donuts.
Let that sink in for a moment.
Then consider the fact that investors aren’t always paying for technology… sometimes they’re paying for the people using it.
Take Facebook’s acquisition of WhatsApp. Earlier this year, the social media giant dropped $19 billion on the messaging service. Might seem odd—until you realize it came with 450 million users, each of whom is worth dollars and cents.
So even if investors aren’t always exactly sure how to leverage these apps, they can rest assured that they’re securing a captive audience.
It’s only a matter of time before they figure out what to do with it.