Quick Take: $100 million Bitmoji’s Are a Defining Moment in Snapchat’s Road to IPO

It might seem an outlandish sum for comic-strip images, but Snapchat’s $100 million acquisition of Bitstrips will prove a relative pittance if it unlocks the advertising possibilities that convince Wall Street the company is ready for an IPO.

Following the revelation of Snapchat’s patent to feature ads augmented onto real-life images within the app’s camera, the Bitmoji acquisition should be viewed in the wider context of the company’s overall Ad strategy. As Facebook will attest, there are major dilemmas to overcome when applying advertising to a social product that consumers have already become accustomed to without diluting the experience. Such questions have persisted since Snapchat’s emergence over how to leverage its huge user-base into meaningful revenue, and though the company’s discover platform has been positively received, they have also divided opinion over inserting ads in-between user’s friend’s stories.

However, one of the most effective methods of advertising on the platform has become sponsored lenses, which are un-intrusive in the present Snapchat experience. Against this success, Bitmojis fit the profile perfectly, they are already widely used across social networks and therefore a familiar proposition to Snapchat’s audience. The ability to use Bitmoji’s in snaps is therefore almost guaranteed to be welcomed by the app’s user-base and their format presents opportunity for brands to interact with Snapchat’s audience in the same way lenses convey messages without interrupting use.

With the phenomenal success of Pokemon Go, augmented camera features are likely to experience huge popularity over the next 12 months, and Snapchat is fortuitously positioned to benefit most from this. With aims of closing off this year with $300 million in revenue and a further $1 Billion in 2017 - solid revenue streams are crucial, and absorbing the service into their product appears a diligent move in the company’s move towards going public. Though it might not be the most conservative acquisition you read about this year, Bitmoji could be the key that unlocks a lucrative future for Snapchat.