Snapchat is finally making some real money, with a lot more coming in 2016. It’s also looking for someone to manage all that cash.
Snapchat is targeting around $50 million in revenue this year, according to multiple sources familiar with the company — a nice chunk of change considering it launched its first revenue product less than a year ago. It also looks as though the company is gunning for a share of the political campaign coffers that are still filling up, and expects to bring in at least $200 million in revenue next year, these sources say. Twitter, for comparison, brought in $300 million in revenue back in 2012, a year before its IPO.
Adding to the intrigue is that Snapchat is in the midst of what is becoming a lengthy CFO search, according to multiple sources. CEO Evan Spiegel started searching informally late last year, and has been leading a more formal, “intense” search since January, these sources say. While coming close with a few candidates, he hasn’t been able to lock anyone down.
There are a few reasons why. The first is the job itself. Snapchat is having a tough time finding someone willing to take on the role, and, more importantly, the pressure and risk that come with it.
A spokesperson for Snapchat declined to comment for this story.
Snapchat is valued at $16 billion, according to a source, despite a new and still evolving revenue model, and it’s likely that whoever takes the position will also be tasked with bringing Snapchat public. Taking any company public is a challenge, but one with a 25-year-old CEO, an unproven business model and a $16 billion valuation creates a lot of extra pressure.
At Re/code’s annual Code conference in May, Spiegel said that he’s already got a plan for an IPO. “We need to IPO,” he said then, though he didn’t share any details around timing. “An IPO is really important.”
Then there’s Spiegel himself. The CEO has always been meticulous about hiring, especially to Snapchat’s upper ranks, and he’s being extremely patient with this search, according to sources; he has set a very high bar for the CFO position. He’s also prone to changing his mind. A lot. He’s looking to bring in someone who is currently running a public company, according to another source. But if he met a Wall Street banker tomorrow who fit the mold? Well, that might switch up the whole profile.
Spiegel is largely handling the search on his own, sources say; independence is kind of his style. That doesn’t mean he isn’t asking for advice. He has access to elite tech circles now, and isn’t afraid to ask for an intro from others in the Valley, according to sources. He also brought Egon Zehnder’s Simmi Singh in-house back in February as chief talent officer, and he’ll often lean on board members like Benchmark’s Mitch Lasky and Sony CEO Michael Lynton, too.
Spiegel has used a recruiting firm in the past to help find previous high-profile hires, including General Counsel Christopher Handman and head of comms Jill Hazelbaker, although it’s unclear if he’s using an outside firm for the CFO search.
Snapchat does have one likely CFO candidate already in the office: Chief Strategy Officer Imran Khan, a former Wall Street banker who joined the company in December from Credit Suisse. But sources say Khan isn’t going to take the job, even though he’s doing the kind of internal financial work typical of a CFO in the meantime.
Even though Snapchat appears to be looking elsewhere, grabbing a CFO from the ranks of Wall Street has been a popular move recently. Google hired Morgan Stanley’s Ruth Porat to be its CFO back in March (the move looks like a smart one so far) and Airbnb hired Blackstone’s Laurence Tosi recently to serve as its CFO.
Snapchat has shown impressive growth, especially among teenagers — more than 100 million people use Snapchat every day, but it hasn’t been making money for long, and its revenue-generating products like Discover are still evolving.
It’s still an intriguing place for advertisers to spend money. Spiegel recently told investors that Snapchat gets three billion video views per day, and some advertisers are buying ad packages as high as $10 million, according to sources. It’s not altogether surprising; Snapchat has a teen-heavy audience that can be hard for brands and publishers to reach. It’s one of the reasons it has 11 (and soon to be more) media partners publishing their own content within Snapchat’s app.
Still, its ads business is inconsistent; some days you won’t see any ads at all within Snapchat. That’s partly because both Snapchat and publishers are still figuring out the best strategy for creating content within the app. Given the expected revenue jump in 2016, it sounds as though Snapchat expects the content — and the ad commitments — to get a lot more consistent moving forward.
Additional reporting by Peter Kafka and Kara Swisher.
This article originally appeared on Recode.net.