Page 57 - Bloomberg Businessweek - November 19, 2018

Bloomberg Businessweek The Year Ahead 2019 Technology

Hot Seat Evan Spiegel

▷ Declining user numbers and a widely panned redesign
have investors worried that Snapchat could fade away

He was once heralded as a genius for offering value. Since the IPO, Spiegel
creating a teen obsession big enough to has cycled through his heads of product,
make Facebook Inc.’s Mark Zuckerberg sales, engineering, legal, and finance.
envious. Now Snap Inc.’s Evan Spiegel Meanwhile, Zuckerberg no longer has
has a disaster on his hands, one mostly of reason to be jealous. His apps copied
his own making. one of Snap’s most popular formats, the
The 28-year-old may be losing his touch ephemeral “stories” feature. It’s done so
after insisting on a Snapchat redesign well, Zuckerberg said in late October,
that alienated both users and advertisers. that he expects stories to eventually be
The company has reported two straight more popular on his properties than the
Zuckerberg no quarters of declining user numbers, and news feed ever was. If that’s Facebook’s
longer has reason its share price is hovering below $7, about future, Snap needs a new idea, fast.
to be jealous 40 percent of last year’s initial public �Sarah Frier

Solution
IPOs 29

▷ Investors have been waiting for big names to go public� Here they come

In 2019, expect to see the most American tech have been spending more time as private com-
mega-listings of any year this century. Uber panies over the past decade, mostly because
Technologies Inc., last valued at $72 billion, they can. With investors such as SoftBank Group
says it’s planning an initial public offering. Corp.’s $100 billion Vision Fund able to write
Rival Lyft Inc. ($15.1 billion) aims to go public check after check, raising cash via private share
by summer time, and office chat software maker sales remains more attractive than going public,
Slack Technologies Inc. expects an IPO valuation which entails added disclosure and scrutiny.
north of $10 billion as soon as it can show full But the big, aging startups are finally coming
2018 financial results, according to people famil- around to the benefits of the Nasdaq. The 46 tech
iar with the matter. Add to the maybe pile Airbnb and communications companies that listed in
Inc. ($31 billion), which a person familiar with the U.S. this year are up 18 percent on a weighted
the company has said is targeting sometime average basis. Publicly traded stock can be used
between June 2019 and the end of 2020. to pay for acquisitions and help recruit, and the
The last time three 11-figure U.S. tech compa- added visibility of a public listing is its own kind
nies went public in the same year, Bill Clinton of soft power. “As companies see the ability to
was president and Apple Inc. was worth less than achieve attractive valuations with quality share-
1 percent of Microsoft Corp. That was 2000, when, holders, they are getting more comfortable going
BRYAN BEDDER/GETTY IMAGES company that made the Palm Pilot was valued ital markets in the Americas for Goldman Sachs
public,” says David Ludwig, who heads equity cap-
with air leaking out of the dot-com bubble, the
at $21 billion, and AT&T Corp.’s wireless subsidi-
Group Inc. The companies declined to comment.
ary went public at a record-breaking $68 billion.
There’s value for less prominent compa-
nies, too. Take Guardant Health Inc., a cancer
Startups with questionable roads to profitability