Evan Spiegel, Snap Inc’s 26-year-old co-founder, has a reputation for playing nasty – but these days he is playing nice. If it works out, he’s going to be a very rich man. Next month Snap, owner of the Snapchat app, will go public on the New York stock exchange, cementing Spiegel and co-founder Bobby Murphy’s place in the ranks of tech billionaires.

Snapchat has the same backstory as many of tech’s biggest names: started in a dorm room in Stanford, phenomenal growth, twentysomething college dropout founders, blah, blah, blah. It might sound like the same old, same old. But this share sale is different and could mark a turning point for tech sales of the future.



Spiegel is now on the road selling Snapchat’s story to investors in London, Paris and New York. And one part of the story he must sell as his company looks to raise an eye-watering $16bn to $18bn in its initial public offering (IPO) is that he and early investors will maintain 100% control of the company. Buy what you want; you won’t get a say in how Snapchat is run. Other tech titans, notably Google and Facebook, have gone public and retained control of their companies. But not even the Google twins or Mark Zuckerberg tried to sell Wall Street on keeping 100% control.



Michael Pachter, WedBush analyst, compares the situation to the Twilight Zone episode It’s a Good Life, in which a town lives in fear of a six-year-old boy with godlike powers and the ability to banish residents if they ever say, do or think anything that offends him.



“What is really going on is you have morally corrupt investment bankers who tell CEOs what they want to hear. Back in the old days, investment bankers were asked their honest opinion of what was the best corporate governance, and they would say: ‘Each investor has a vote.’ It’s morphed since Google into: ‘Yes, you are a genius and no one should question you.’”



“These insecure founders are so utterly convinced that their vision is the only one appropriate for their creation that they want to make sure that as long as they are alive and involved in their companies, their vision will not be challenged,” he said.



If would-be investors buy into the Snapchat story and Spiegel’s genius, Pachter sees no reason why the sale cannot be a success. And early signs are that retail investors, especially the younger ones, are clamouring for shares.



Robinhood, the app-based free trading app that now boasts over a million traders, surveyed 6,000 of its customers last week and found 30% were definitely interested in buying Snap and 35% were thinking about it.



“People are pumped about the IPO,” said Vlad Tenev, Robinhood’s co-founder. Tenev said his customers tended to be younger than the average broker. “Given our demographic, a lot of Snapchat users are Robinhood users, and for them, this is one of the most anticipated IPOs ever.”



If investors are lining up for a piece of Snapchat, the likely consequence of a successful sale will be more IPOs with 100% control remaining with the founders.



What is it that people are buying with Snap Inc? The five-year-old company started life as a message-sharing app with one key difference. Messages disappeared after a short interval (or at least were supposed to). Filters allow users to morph their faces and voices with an ever-changing array of options. For a new generation who have seen what an ill-considered social post can do, Snapchat offered a new, less permanent way to share bits of their lives.



Evan Spiegel in 2013. An analyst compares his position to an episode of The Twilight Zone. Photograph: Jae C Hong/AP

It’s a service that found an audience. Some 158 million people use Snapchat each day and create 2.5bn “snaps” between them. The average 20-year-old user spends about 30 minutes a day on the service. Users, media companies, celebs and brands now put short video stories up on the app that attract 150m daily active users.



In a world gone mobile, these are amazing numbers. Growth has slowed recently (to a still-staggering 48% year-on-year) as Facebook has copied many of Snapchat’s features. Snap’s revenues grew from $58.7m in 2015 to $404.5m in 2016. But losses also mounted to $514m in 2016 from almost $373m a year earlier.



In the old days it was ‘each investor has a vote.’ It’s morphed into: ‘You are a genius and no one should question you' Michael Pachter, investment analyst

There’s something for everyone in Snap’s sale. The company could be the new Facebook or the new Twitter, which lost Wall Street’s interest just months after its IPO. Worse still, it could be a total bust. Facebook is rapidly copying many of Snapchat’s moves – what if the service lasts as long as one of its snaps?



So what investors are really buying is Spiegel.



The 26-year-old son of California lawyers grew up in the Pacific Palisades, a glittering Los Angeles enclave just east of Malibu. He drives a Ferrari, once dated Taylor Swift and now lives with his girlfriend, the model Miranda Kerr, in a house once owned by Harrison Ford.



It’s a glamorous life he has carved out with equal displays of talent, chutzpah and hard-heartedness. Former best bud and Snapchat co-founder Reggie Brown fell out with his partners after eavesdropping on their plans to oust him. After a nasty legal tussle, Brown was paid $158m to walk away.



In 2012, Zuckerberg started making a play for Snapchat, suggesting the Los Angeles-based Spiegel come visit Facebook at its sprawling Silicon Valley headquarters. After he received the message, Spiegel and Murphy returned to their office and ordered six copies of Sun Tzu’s The Art of War, one for each of their employees. The next year he shocked the tech world when it emerged he had turned down a $3bn offer from Facebook for the company.



“There are very few people in the world who get to build a business like this,” Spiegel told Forbes for a cover story. “I think trading that for some short-term gain isn’t very interesting.” Spiegel was right: $3bn isn’t as interesting as $18bn.



But Spiegel has more than gamesmanship: he has skills. Snapchat’s early investors are a bunch it would be hard to impress. Spiegel impressed them and Snapchat’s IPO proves they were right to back him. They will all walk away from the sale far richer.

Spiegel and Murphy each own 22% of Snap’s Class A stock, so if it IPOs at $18bn, they will both own shares worth $3.96bn. Between them they will control 88.6% of voting shares. The rest of the voting shares are owned by Benchmark, the Silicon Valley investor that counts Uber and Twitter among its other wins, which owns 12.7% of Class A shares, another venture capital firm, Lightspeed. Key staff and executives, including Michael Lynton, the British-born former head of Sony Pictures who is now Snap’s chairman, own fractional (but highly valuable) percentages. Lynton and his wife, Jamie Alter, became early investors in the company after seeing their daughters use the service.

Those who come to the Snapchat party now will be hoping Spiegel can make them money, too, and perhaps emerge as the new Steve Jobs to Zuckerberg’s Bill Gates. Perhaps he will, perhaps he won’t. But once the money is handed over, investors will have to remember to keep their opinions to themselves.

