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Business Observer Tuesday, Jan. 28, 2014 4 years ago

The dude who turned down $3 billion

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The story of the social media entrepreneur who turned down $3 billion from Facebook, Evan Spiegel, is no longer a hot of the press news item.
by: Mark Gordon Managing Editor

The story of the social media entrepreneur who turned down $3 billion from Facebook, Evan Spiegel, is no longer a hot of the press news item.

But the fact that it happened in November doesn't make it any less insane. It's so crazy-kooky, in fact, that I still find it helpful for an icebreaker at interviews, lunch appointments or a networking event. In the context of “can you believe some yahoo out there turned down Zuckerberg, Facebook and $3 billion?” It's a great conversation starter.

The gist of the situation is Spiegel runs Snapchat, a photo messaging service where the images it delivers to a recipient disappear within 10 seconds. The service is wildly popular with teens, a demographic Facebook covets. So late last year Facebook, through founder Mark Zuckerberg, offered Spiegel $3 billion for the business — fully aware that Snapchat had yet to make any money, despite the popularity. Spiegel rejected Facebook's offer, saying short-term gain isn't interesting.

I was 100% on the side of those who say Spiegel blew the best chance he will ever have to cash in on his creation. But my opinion changed, at least a little bit, when I recently read an article in Forbes magazine about Spiegel and Snapchat co-founder Bobby Murphy. Spiegel was on the cover of the magazine's Jan. 20 30-under-30 issue.

The article, which claims to be Spiegel's first in-depth media interview, describes a privileged, brash, cocksure 23-year-old. (Dislike.) But it also details some of Spiegel's business savvy. (Like.) For example, after a 2012 meeting with Zuckerberg, when Facebook's intentions were clear, Spiegel ordered copies of Sun Tzu's The Art of War for all six Snapchat employees. That's some admirable spunk.

Now I'm not sure. Maybe it's Spiegel that's onto something. Maybe Snapchat is the next big thing. Maybe Spiegel was right, not crazy, to shoot down a $3 billion offer.

Then again, $3 billion is $3 billion. It would take a long time to make that money disappear.

What do you think about Spiegel's decision to spurn Facebook? Savvy or Stupid?

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