By David Repka
The Duck Face photo sharing site known as Snapchat recently turned down an offer of $3 billion from Facebook. As a hard working 40-something entrepreneur that has worked nearly every day of his life since he was a teenager cutting lawns and washing cars… how does that make any sense to anyone over the age of 24?
Yes, it is pure genius that the 23-year old founder figured out how to make photo messages self destruct after someone sends you a Duck Face photo (unless of course you screen capture the photo to your iPhone like my teenage daughters have figured out how to do much to my chagrin as the keeper of the iPhoto library chock full of hundreds if not thousands of duck face, scary faces, ugly faces and sparrows). But saying no to $3 billion in real cash for a one dimensional app without any massive barriers to entry, intellectual property or economic moats to keep out marauding invaders? Seriously? How are you saying no to that?
$3 billion is serious money for a 2-year old start up company. Think you are leaving money on the table? In one of my favorite interview one-liners legendary entrepreneur Mark Cuban was asked if he felt “stupid” leaving money on the table when the Yahoo stock he sold went from $200 a share to $230 a share? Cuban’s remark: “It’s kinda hard to feel stupid when I’m flying around in my G-5”.
The best entrepreneurs always know when to “capture the profit” and harvest their winnings.