What truly matters is how leadership responds. And time isn’t Snap’s friend.
There is a bottom line when it comes to what’s acceptable in the workplace and Snap just crossed it.
Yesterday, an email written by a former Snap female developer, Shannon Lubetich, emerged. The email was written back in November, on Lubetich’s last day of work. In it, she accused Snap, the makers of Snapchat, of having a toxic and sexist culture.
You may remember that moment late in The Fellowship of the Ring when hobbit-hero Frodo Baggins arrives at a safe haven in Rivendell, only to realize that his quest has just begun — and he’s got two more books’ (or movies’) worth of perils to surmount. IPOs are kind of like that.
Companies, executives, and investors often feel that going public is the end of a road, and of course it is. But it’s also the on-ramp to a much longer labor for everyone involved. You’ve sold the world on a vision? Great. Now you’d better deliver.
Or will at least be reduced to a ghost of its former self.
Snapchat’s parent company, Snap Inc, is preparing for its initial public offering (IPO) this week. This will be the largest IPO since Alibaba went public in 2014. Speaking of which, Alibaba, the Chinese tech giant, saw a 10% drop in stock prices after its IPO. Twitter and Facebook, Snapchat’s closest related IPO predecessors, both suffered even steeper declines in stock prices in their early months after going public. Twitter prices sunk 25% in the first 6 months after IPO. Facebook prices dropped 50% in their first 5 months.
In comparison to Facebook and Twitter, Snap Inc is limping to the starting line. Snapchat is witnessing seriously concerning drops in user acquisitions, and their price-to-sales ratio will far exceed historical marks when the stock opens at $14–$16. Putting all that aside, Snapchat has much more deep-seated troubles. The nature of their platform itself puts them in serious risk to follow the paths of Vine and Yik Yak on a much larger and more devastating scale.