Video- and photo-sharing app Snapchat is having a meteoric rise. It shares more than 200 million photos a day, a number that is reaching Facebook's level of photo-sharing, and has been recently valued at $860 million without making a penny.
Snapchat, only two years old and privately owned, has no revenue, Fortune reported.
It's harder to understand the valuation when one looks at the way Snapchat does business. Its "snaps" or photos with messages, only last a few seconds in an attempt to stop users from downloading them or taking screenshots. Snapchat is supposed to be ephemeral (although there are ways around that, especially if you are using iOS 7), so placing ads on something for only a few seconds isn't the usual mobile ad model.