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Snap Inc., the company behind the popular social media app Snapchat, has filed confidential paperwork for the long-awaited IPO that could be the biggest market debut in the U.S. since Alibaba.

Reuters broke the news about Snapchat's secret IPO filing yesterday, citing anonymous people familiar with the matter. Venice, California-based firm could go public already next March with a valuation of approximately $20 billion to $25 billion, what would make Snap Inc. the largest IPO since Chinese e-commerce giant Alibaba (NYSE: BABA) went public in 2014 at $170 billion as well as the largest technology IPO since Facebook's (NYSE: FB) $81.2 billion market debut 4 years ago.

Snap Inc. reportedly filed for an IPO before the big elections day last week and was able to do so confidentially, hiding from public attention up until yesterday. The U.S. Jumpstart Our Business Startups Act was the reason why Snapchat could file for an IPO secretly in the first place, as this law allows firms with an annual revenue below $1 billion to submit paperwork to SEC without sharing it publicly. The law, passed in 2012, allows companies that fall under this sales threshold to enjoy softer IPO requirements as well as have a chance to "test the waters" with investors before having to make public statements.

A 4-year old Snapchat has made its name as an app allowing the users to send videos and pictures that self-destruct after 10 seconds of a person viewing them. The app has attracted an impressive daily audience of more than 150 million users, having more than 60% of all smartphone users between 13 and 34 using the app, reports the Wall Street Journal. Yet another statistics Snapchat likes to use to win over advertisers states that the app reaches 41% of all young people in the United States between 18 and 34 whereas an average TV channel among the top performers reaches only 6% of the same audience. Content-wise, the users share more than 1 billion 'snaps' per day and watch over 10 billion videos daily.

The tipping year for Snapchat's revenue was 2014, when the company decided to run ads in its app. This helped to bring the company closer to the social media "elite" of Facebook, Instagram and Twitter. For this year, the firm expects revenues of between $250 million and $350 million but as much as $1 billion for 2017.

Earlier this September, Snapchat CEO Evan Spiegel introduced a first hardware product of the social media company, video camera sunglasses named Spectacles, and renamed Snapchat into Snap Inc. calling it a "camera company". This marked the first big change in the company's strategy since its inception in 2012 and possibly opening new sources of revenue, as some investors were worried about the future of the app's advertising sales, which are the only significant source of the company's revenue today.

However, Snapchat has demonstrated some healthy user base growth in the last years and became the third most popular social media among millennials after Instagram and Facebook. And, considering Twitter's recent troubles, the company has all the chances to go even further next year. And this is exactly what Facebook, which is basically occupying the top 2 places in the "most popular social media" rating by owning Instagram, does not like. Last week, Facebook launched yet another Snapchat clone named Flash that looks and feels almost identical to Snapchat. This is the third time Facebook tries to smash its competitor, though the previous apps mimicking Snapchat’s video and picture sharing mechanism did not take off.

A good sign for "unicorns"

Snap Inc.'s long-awaited IPO is definitely some good news for tech investors while the experts hope that Snap's IPO example would convince other tech startups to finally go public, as the U.S. IPO scene has been having its worst months since the post-crisis 2009 this year. Reuters said that many investors hoped that other large "unicorn" companies like Uber and Airbnb, those private firms with revenues of over $1 billion, would follow Snap's example. Up until today, only 123 American tech companies filed for an IPO and collectively raised slightly over $7 billion, which is 58% lower than last year, reports Reuters. The first quarter of 2016 was the worst in years with zero tech companies going public.

IPOs are at the all-time lows in 2016. What happened?

The Wall Street Journal adds that IPO pricings for tech companies this year were rather "conservative", as the average multiple of total firm value to expected sales at their IPO in 2016 was at 3 times compared with 3.6 times in 2015 and 4.9 times in 2014. This means that Snap Inc. might not score the valuation it aspires to or even go public in the planned time, adding to more IPO disappointments this year.

However, the experts say that the main reason for such a sluggish IPO activity in the American tech industry is market volatility that makes going public for startups more risky. And, with Donald Trump winning the presidential elections, there is only more volatility to come next year.

"Volatility in the markets is absolutely the enemy of IPOs," an IPO consultant Lise Buyer told CNBC.

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