Snap vs X (formerly Twitter)

Evan Spiegel pitched the concept of disappearing photo messages as a class project at Stanford in 2011. His classmates Bobby Murphy and Reggie Brown helped build the first version. The app launched as Picaboo in July 2011, renamed Snapchat in September 2011. Brown was pushed out of the company shortly after launch; he later sued Spiegel and Murphy, claiming they had stolen the original concept. The lawsuit was settled for an undisclosed amount. Brown's name was not included when Snap went public.

Mark Zuckerberg flew to Los Angeles in November 2013 to meet Evan Spiegel in person and offer $3 billion in cash to acquire Snapchat. Spiegel, then 23 years old, turned him down. The decision was widely criticised — $3 billion for a company less than two years old with no revenue seemed extraordinary. Spiegel believed Snapchat would be worth far more. Within a year, Snapchat was raising money at a $10 billion valuation.

Snapchat launched Stories in 2013 — a format allowing users to post photos and videos visible for 24 hours before disappearing. The format was so successful that Facebook copied it directly into Instagram in 2016, then WhatsApp, then Facebook itself. Zuckerberg acknowledged the copying openly. Instagram Stories rapidly overtook Snapchat's Stories in daily users. The company that had rejected Facebook's $3 billion acquisition watched Facebook replicate its most innovative feature and deploy it across platforms with a combined user base ten times larger than Snapchat's.

Snap went public in March 2017 at $17 per share, valuing the company at $24 billion — making Spiegel one of the youngest self-made billionaires in history. The IPO gave Spiegel and Murphy shares with ten times the voting rights of public shareholders, giving them permanent control regardless of investor sentiment. Snap's user growth subsequently slowed dramatically as Instagram Stories captured the casual user market.

Snap reported revenues of $5.3 billion for 2024 — up 16% — with 443 million daily active users. The company had successfully built a large, profitable-ish advertising business. But the stock had never recovered to its $17 IPO price since falling 80% in the 18 months following the IPO, reflecting investor skepticism about Snap's ability to grow beyond its core teenage demographic and compete with TikTok, Instagram Reels, and YouTube Shorts for creator content. The founder who had rejected $3 billion at 23 had built a $12 billion market cap company — real, but a fraction of what the rejection had been expected to yield.

The idea for Twitter came from Jack Dorsey during a brainstorming session at podcasting startup Odeo in March 2006. The first tweet was sent by Dorsey on March 21, 2006: "just setting up my twttr." The name Twitter was chosen because it described the short bursts of inconsequential information that birds make. Within four years, Twitter had become the nervous system of breaking news worldwide.

Jack Dorsey was removed as CEO of Twitter in October 2008 by co-founder Evan Williams, who took over the role himself. The official reason was that Dorsey spent too much time on personal interests — including fashion design and yoga. Dorsey went on to found Square (later Block). Williams later said firing Dorsey was simultaneously the right decision and the wrong decision.

Elon Musk began buying Twitter shares in January 2022, eventually accumulating a 9.1% stake. He offered to buy the entire company for $54.20 per share — $44 billion total. Then tried to back out. Twitter sued him. A Delaware court ruled against Musk. On October 27, 2022, Musk completed the acquisition, walked into Twitter headquarters carrying a sink, fired approximately half the company within 48 hours, renamed it X, and replaced the iconic bird logo with a stylised X. Brand consultancies estimated the rebrand destroyed $4 billion in brand value overnight.

Musk renamed Twitter to X in July 2023, describing his vision as a WeChat-style "everything app" combining payments, messaging, news, and social media. Advertisers fled over content moderation concerns. Revenue fell by an estimated 50% from Twitter's pre-acquisition levels. Musk responded by suing advertisers for what he called an illegal boycott. Linda Yaccarino, hired as CEO to rebuild advertiser relationships, resigned in July 2025.

In March 2025, Elon Musk's AI startup xAI formally acquired X in an all-stock deal that valued X at $33 billion — $11 billion less than Musk had paid for it three years earlier. xAI, which had been valued at $80 billion, absorbed X to combine its Grok chatbot with X's 600 million monthly users and real-time data. The combined entity, called xAI Holdings, was worth approximately $113 billion. Musk had effectively bought Twitter from himself — using a company he had founded specifically to compete with OpenAI.