Snapchat targets teen market to ensure profitability and significant growth

By Quantum Capital Fund

With the mobile revolution being one of the biggest defining features of the technology industry since the invention of the internet, companies who want to become profitable need to have a significant mobile presence. Those who want to make extraordinary profits need to target specific target markets which play a significant role in the industry for the foreseeable future.

Apps which facilitate this become attractive investments and will attract significant attention of potential investors. Mobile app Snapchat is currently in talks to facilitate a fresh round of funding where the company would raise $100-million, this would give the app a massive valuation of $500-million. The popularity of the app is immense and is somewhat staggering considering that only a few months ago the company was valued between $60-million and $75-million.

The popularity of Snapchat lies in its product offering. The 2-year-old mobile app, which is extremely popular with youngsters, offers people an impermanent way to send text, pictures, and videos to friends that disappear after a few seconds. Members upload more than 150 million images every day, CEO and co-founder Evan Spiegel said in April.

Snapchat seems ready to take the market by storm and will give industry heavyweights a serious run for their money. Reports also indicate that its backs won’t be your regular Silicon Valley investment firms but rather hedge funds who are interested in targeting projects which carry a good chance of short term success.

Wherever the $100 million comes from, the new money would signify Snapchat's interest in creating a business around an app that initially seemed more like a throwaway gimmick than an app destined for social-media greatness. But tweens and teens, who enjoy goofing off without parental interference, have spoken; they've made Snapchat a more permanent sensation than the transitory content it encourages.

Targeting market sectors is an effective way to ensure profitability, however it can be detrimental if the wrong group is targeted. Proper market research needs to be undertaken and comprehensive due diligence needs to be carried out in order to ensure the success of the investment.