A huge tech initial public offering raises billions. More money would be available for super-rich bankers and investors. Well, that’s not the whole story. Not this time. If you’re a parent, a letter home from school is common. But today, the president of Saint Francis High School in Mountain View, California, Simon Chiu wrote to parents to share some “monumental news”.
In 2012, he began, the school spent $15,000 in a cool new app that was being used incessantly by Natalie and Andrew Eggers, two siblings who attended the school. Their father Barry was a partner at a local investment firm, Lightspeed Venture Partners. After seeing how excited his children were to be using the app, and learning that their friends were as obsessed as they were, he decided to get involved. It was obviously the Snapchat.
He met with co-founders Bobby Murphy and Evan Spiegel, who today are multi-millionaires thanks to their company’s incredible stock market debut, but back then were working out of a room at Stanford. Mr. Eggers was suitably impressed, and so Lightspeed led a $500,000 investment round – Snapchat’s first.
The firm spent $485,000, but Mr. Eggers also convinced Saint Francis High School to throw in $15,000 from a school development fund set up in the 1990s. In what must go down as one of the understatements of the year, On Thursday Mr. Chiu’s letter continued: “The school’s investment in Snap has matured and given us a significant boost as we continue our work towards realizing the bold goals and vision.”
One of those goals is to make education at Saint Francis, a private Catholic school where tuition costs $17,000 a year more affordable to more people in the surrounding community. So how much did the school earn? It’s hard to say exactly right now. It sold many of its shares on Thursday at the $17 opening price. That raised a cool $24m. A great little earner with perhaps a lot more still to come.