Published On: Sun, Nov 17th, 2013

Snapchat Awarded Patent For Funding Valuation Algorithm

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Snapchat, the app that helps people communicate using snaps that disappear, has been awarded a patent for a unique algorithm for Series C Funding. The patent has been awarded for a system “that uses technology media and tools to add multiple zeros to a zero-profit company’s valuation (for Series C Funding)”. The process highlights are presented below, with the example of Snapchat:

1. Write down the company’s profit, in USDs (‘0’)
2. Add ‘1’ to the left (’10’)
3. Add a few zeros to the right. Stop when it is time for a break. (1000000000)
4. Multiply the number from 3, by 3. (3000000000)
5. Get tech media to report on bidding wars starting at number from Step 4, with increments of number from Step 3. (3000000000 to 4000000000)
6. Raise Funding at a Valuation more than the number reached by the tech media (?)

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Snapchat Awarded Patent For Funding Valuation Algorithm