A Catholic high school in California has turned a $15,000 investment made five years ago into a $24 million windfall after the company that created the mobile app Snapchat went public with an initial public offering of stock.
KNTV-TV reports that St. Francis High School in Mountain View, Calif., was one of the early investors in Snap Inc. When the company began selling stock on Thursday, the school's $15,000 translated into more than 2 million shares. The school sold about 1.4 million shares at $17 a share and has added $24 million to its coffers. St. Francis still owns about 600,000 shares of the company
Soon after trading opened on the New York Stock Exchange, Snap stock began trading at more than $24 a share. As of early Friday afternoon, the price has climbed to more than $26.
St. Francis says it invested $15,000 of the institution’s endowment fund in Snap’s seed round of financing in 2012 after a venture capitalist who also was the father of two St. Francis students invited the school to be part of the investment he was making.
"Barry Eggers, a founding partner at the venture capital firm Lightspeed Venture Partners, was intrigued as his two children...returned home from school one afternoon enthralled by a new social media app called Snapchat," St. Francis President Simon Chiu explained in a letter to the school community. "After learning of the extent of Snapchat's popularity...Barry knew his wanted to invest in the promising company, and in a stroke of remarkable generosity, he decided to invite Saint Francis to join him."
Snapchat's first seed investment of $500,000 consisted of $485,000 from Lightspeed and $15,000 from St. Francis.
The Snapchat app is popular with the young people and is best known for disappearing messages and quirky face-filters.
St. Francis hasn't determined exactly how the money from Snapchat will be spent, but officials say financial aid for students is their top priority, and the money will not be used for day-to-day operating expenses.
"The return on this investment will allow to accelerate the goals of our strategic plan, which emphasizes our commitment to make Catholic education more affordable and accessible to our community, recruit and retain outstanding faculty and staff, and develop innovative programs and facilities," Chiu said.
Video from KNTV-TV: