Who could ever predict that the SNAP IPO would end up looking like a not-so-slow moving car crash?
Well, other than us...
Since debuting at about $27 a share in early 2017, SNAP shares have dropped off in such a dramatic way that a chart of its total performance looks like the visual representation of a long, wet fart sound effect
Aside from having no fully-realized revenue plan, disappointing growth and living under the existential threat of Facebook, Snap is also hemorrhaging executives and becoming uncool very quickly.
Suffice to say a little too late that SNAP's entrance into the public markets now looks like a true contender for the IPO Hall of Shame. The whole thing has been a shitshow embarrassment that would have been spectacularly unique in its failure had Blue Apron not taken a real shot at stealing its thunder. With the stock price down by just over 75% in less than two years, and with no hope in sight, it felt like things could not get worse for Snap...but that feeling was wrong:
The U.S. Justice Department and Securities and Exchange Commission have subpoenaed Snap Inc. for information about its March 2017 initial public offering, the social media app maker told Reuters on Tuesday.
That's right, the SEC is basically investigating why the SNAP IPO was ever a thing that happened.
The previously unreported federal inquiries follow an ongoing shareholder lawsuit in which investors allege that Snap misled the public about how competition from Facebook Inc’s Instagram service had affected the company’s growth.
Snap said it believes that the federal regulators “are investigating issues related to the previously disclosed allegations asserted in the class action about our IPO disclosures.”
“While we do not have complete visibility into these investigations, our understanding is that the DOJ is likely focused on IPO disclosures relating to competition from Instagram,” the company said.
We don't have complete visibility into this either, nor any cogent understanding of securities law, but we are pretty sure that we're watching the actual SEC spending actual time and effort looking into how Snap convinced anyone to buy its stock while Facebook existed. So batshit is the notion that anyone would bet on SNAP right now that the government wants to make sure Snap investors are just dumb and not the victims of a mind trick that made them believe there was no such thing as Facebook.
We're not even making this up, and that's embarrassing.