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Snapchat: the biggest US tech IPO since Facebook?

The app that allows people to send photos and videos that quickly disappear could soon sell company shares to the public.

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An image of the Snapchat logo created with Post-it notes is seen in the windows of Havas Worldwide at 200 Hudson Street in lower Manhattan, New York, in May 18, 2016.

Mike Segar/Reuters/File

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In what could be the biggest stock market event in a couple of sluggish years, the parent company of Snapchat, the app that allows people to send photos and videos that quickly disappear, reportedly has filed for an initial public offering (IPO).

The Ventura, Calif.-based Snap Inc. recently filed with the Securities and Exchange Commission under a law that allows companies with less than $1 billion in revenue to file paperwork confidentially to keep their financial records concealed from public review while they sort out the transaction, according to Reuters, which spoke with anonymous sources familiar with the filing on Tuesday.

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If Snap decides to go public – 75 percent of companies that file for an IPO do not – it could complete the process by March. Valued between about $20 billion and more than $30 billion, the app company’s share offering would be the biggest US tech IPO in the United States since Facebook’s public debut in 2012, when that company was valued at $81.2 billion. Chinese company Alibaba Group Holding went public in the US two years ago, when it was valued at $170.9 billion, in the largest IPO ever.

This year saw so far has seen the fewest IPOs since 2009, according to the Wall Street Journal, which reports that 103 companies listed their shares in the US this year, compared to 165 last year.

Snapchat makes money from one source: ads shown to its 100 million daily users, who include 41 percent of 18- to 34-year-olds in the US, according to Snapchat.

Though it has only one source of revenue, a concern for investors, the company’s two-year old advertising business could reach $1 billion in sales next year, up from approximately $350 million expected this year, as The New York Times reports. Specific financial data about the company will be available when its IPO filing is made public.

Snapchat was founded in 2011 by Stanford University students as a service that delivers text messages that disappear within seconds. Today it has grown into a sophisticated communications platform that offers a comprehensive and fun way to talk to friends, which has it poised to compete for online advertising domination with companies such as Facebook, which recently reported that its third-quarter revenue shot up by 56 percent to $7 billion, and its profit for the same time period nearly tripled to $2.38 billion.

In September, Snap expanded into the technology hardware category with the launch of sunglasses that can shoot video, called Spectacles.