Snap hopes its estimated 2017 sales of about $1 billion, up 150% from 2016, will be enough to justify a rumored $25 billion price tag. That valuation hinges on investors' confidence that it can increasingly monetize a fast-growing user base (check out Snap's key stats), following in the footsteps of rival Facebook (Nasdaq: FB) while avoiding the pitfalls that plagued Twitter (NYSE: TWTR).
In the middle of 2009, Facebook was on track for $1 billion in sales over the next 12 months, and three years later it went public at a valuation of $104 billion. Now that Snap is nearing the $1 billion mark, public investors who think it's the next Facebook may buy into Snap's $25 billion valuation on its potential for a 300% return over three years.
