Evan Spiegel Is Betting Snap on $2,195 Glasses No Shareholder Can Veto

Evan Spiegel

Photo: cellanr / CC BY-SA 2.0, via Wikimedia Commons

Born	June 4, 1990 Los Angeles
Occupation	Computer Scientist
Awards	Time 100

For most of his career Evan Spiegel has watched larger companies make money from ideas Snapchat shipped first. The vertical, vanishing story format that now fills Instagram and WhatsApp started inside his app. Now the co-founder and chief executive of Snap Inc. is asking investors to trust him with something harder to copy: Specs, a pair of augmented-reality glasses priced above two thousand dollars and built by a company that has never closed a year with a net profit. An activist fund wants the project spun off or shut down. Spiegel does not have to listen, because the shares sold to the public carry no vote.

Spiegel grew up in Pacific Palisades, the son of two Los Angeles lawyers, a few miles from the beaches where Snap would later set up its offices. At Crossroads School in Santa Monica he was already taking design classes at the Otis College of Art and Design, and he went on to study product design at Stanford. In a class there he pitched an app for photos that delete themselves. Working with classmates Bobby Murphy and Reggie Brown, he released the prototype as Picaboo; within weeks it had been renamed Snapchat.

Spiegel, born in Los Angeles in June 1990, was 20 when he made that pitch in April 2011, and Picaboo reached the App Store that July. The founding story carries a contested footnote. Brown sued in 2013, saying the disappearing-photo idea had been his and that he had been pushed out; in deposition, Spiegel described him as an intern. Snap paid $157.5 million to settle in 2014, a sum the public learned only when the company filed to go public. By then Spiegel had left Stanford shortly before finishing his degree, and in November 2013 he turned down a reported $3 billion cash offer from Facebook. He went back for the remaining credits and graduated in 2018.

What justified the refusal was a feature launched that same autumn. Stories let users string snaps into a 24-hour sequence visible to all their friends, and by mid-2014 it had overtaken private messages as the app’s main use. Instagram introduced its own version in 2016. Snapchat Inc. renamed itself Snap Inc. that September and announced Spectacles, sunglasses with a camera that recorded ten-second clips, sold from yellow vending machines called Snapbots. Spiegel called them a toy. About 220,000 pairs sold, and the company wrote off roughly $40 million in unsold inventory and parts in late 2017.

Snap listed on the New York Stock Exchange in March 2017 under the ticker SNAP. Spiegel, 26, became one of the youngest chief executives of a public company, two years after Forbes had counted him as the world’s youngest billionaire, and the structure of the offering was its most argued-over feature: outside buyers received shares with no voting rights, while Spiegel and Murphy kept more than 70 percent of the voting power. Time put him on its list of the 100 most influential people in 2014 and again in 2017.

The image of the founder as product visionary has never been the whole record. In 2014 emails he had written in his fraternity at Stanford leaked to Gawker, full of misogynistic and homophobic remarks; Spiegel said he was mortified and had no excuse. The 2017 redesign of Snapchat drew a petition signed by more than 1.2 million users, and a single February 2018 tweet from Kylie Jenner asking whether anyone still opened the app was followed by a drop of more than $1.3 billion in Snap’s market value. The governance that lets Spiegel play a long game also means no shareholder can stop a bet that goes wrong.

This year has tested that arrangement more openly than any before it. In January Snap moved its glasses into a separate subsidiary, Specs Inc. On 31 March Irenic Capital, which holds an economic interest of about 2.5 percent in Snap’s Class A stock, published a letter urging him to spin off or close the unit, saying Snap had spent more than $3.5 billion on it and was burning around $500 million a year. Two weeks later Spiegel cut about 1,000 jobs, 16 percent of staff, and called it a “crucible moment,” promising more than $500 million in annual savings. “This is an incredibly difficult decision, and I am deeply sorry to the colleagues who will be leaving us,” he wrote in a memo reported by Business Insider.

He did not cut the glasses. At the Augmented World Expo in June he revealed Specs at $2,195, and told Reuters that investors might want short-term profit while his job was long-term success. Second-quarter results in August gave him some cover: revenue rose 19 percent to $1.6 billion, the net loss narrowed to $164 million and daily users reached 493 million. In a September note to staff he admitted that “we’ve never turned a full year GAAP net income profit” and offered a line meant for rivals: “TikTok has trends, Meta has scale, and Snapchat knows the real you.”

At the Los Angeles launch on 16 September, Spiegel presented Specs as part of a system he calls Specs Intelligence, with a charging case that adds a cellular connection, Verizon as the first US carrier, and partners including Shopify and the NBA. Early hands-on reviews found the frames bulky and the field of view narrow, and Forbes summed up the doubt in October: Spiegel keeps seeing the future but cannot seem to win it.

Away from the company, Spiegel married the Australian model Miranda Kerr in Los Angeles in May 2017. They have three sons, and he is stepfather to Kerr’s son with Orlando Bloom. A committed Francophile, he received French citizenship in 2018. He joined the board of KKR in 2021 and that of Gagosian gallery in 2022, and at the 2022 commencement of Otis College he and Kerr paid off the graduating class’s student debt.

Deliveries of Specs are promised this autumn in the United States, Britain and France, and a public demo space has been open in Los Angeles since 1 October. The first sales figures will show whether the man who turned down Facebook has built the next computer, or a $2,195 sequel to the toy.

Tags: business, ceos, business leaders, Evan Spiegel, Snap Inc., Snapchat