Founded 2011
Three Friends, One Disappearing-Photo App, and a $157 Million Lawsuit
Not every origin story ends clean. This one's a genuine, disputed mess — and still a useful one.
This one comes with a warning label, upfront: unlike the others on this list, parts of Snapchat's founding story were genuinely disputed in an actual courtroom, not just remembered differently by different people years later. We're sticking to what both sides agree actually happened.
Three fraternity brothers at Stanford
Evan Spiegel, Bobby Murphy, and Reggie Brown were Stanford students and fraternity brothers. In spring 2011, the idea of an app for sending photos that automatically disappeared came up among the group. That summer, the three of them worked out of Spiegel's father's house near Santa Monica, building an early version they called Picaboo — Spiegel as CEO, Murphy writing the code, Brown handling marketing.
Hold up — "Picaboo." As in peek-a-boo. That was the actual working name before somebody, mercifully, changed it. Every billion-dollar company has an embarrassing early name it would rather you forget, and this is a genuinely strong contender for worst one.
Where the story splits
What happened next depends entirely on who's telling it. Brown later said he came up with the core idea and was pushed out once the app started gaining real traction. Spiegel and Murphy's side disputed how much of a "founder" Brown really was — though Spiegel had, at earlier points, credited Brown with the idea in emails to the press. In 2013, Brown filed a lawsuit claiming a one-third ownership stake in what was, by then, a company valued in the billions.
The case dragged on for over a year, through funding rounds and Snapchat turning down a reported $3 billion acquisition offer from Facebook right in the middle of it all. It was eventually settled on confidential terms, though it was widely reported at the time to be worth somewhere around $157.5 million.
Hold up — how could a dispute between three former friends end up costing over a hundred and fifty million dollars to settle? Because nobody wrote anything down when the company was worth nothing, and by the time it mattered, everyone's memory of who-said-what-to-whom conveniently supported their own side. Write things down. Seriously.
What actually survived all of that
Whatever really happened in that Santa Monica house in 2011, the product itself kept growing straight through the entire dispute — through a lawsuit, through a massive rejected buyout, through a few very public, very messy years. Snapchat went public in 2017 at a $31 billion valuation. The disappearing-photo idea, whoever it truly belonged to, turned out to be worth fighting over.
Skyler's Take
- 1.Get co-founder agreements in writing, early, before anything is worth fighting over. This dispute reportedly cost well over $100 million to resolve, in large part because nothing was written down at the start.
- 2.Turning down a massive buyout offer (Snapchat said no to roughly $3 billion from Facebook) takes real conviction in where you think the thing is headed — and it doesn't always pay off, but here it did.
- 3.A disappearing-photo joke between friends, taken seriously by just one of them, became a public company. Ideas are genuinely cheap; the follow-through is what's rare.