It came to light earlier this week that Snap Inc. – the parent company of Snapchat – has filed confidentially for an initial public offering. With more than 150 million daily active users and an aim to generate more than $350 million in advertising revenue this year, this is huge news for the stock markets.

According to sources who do not wish to be identified, Snapchat filed papers with the U.S. Securities and Exchange Commission last week, and are targeting a valuation of about $20 billion to $25 billion. The company was able to file IPO documents secretly because it has revenue of less than $1 billion currently. It is also rumoured that the company could go public as early as March.

Snapchat has chosen Morgan Stanley and Goldman Sachs Group Inc. to lead its offering, perhaps following in the footsteps of another technology giant, Facebook, which had an IPO handled by Morgan Stanley more than four years ago.

Is this a brave step, considering the current market conditions? The market for technology IPOs this year has been rocky. There has been volatile technology stock performance, and this year has seen a 20% drop in the number of offerings from this time last year.

However, they are a popular company that is still growing. In September of this year, Snap started to brand itself as a “camera company”, and earlier this month saw the debut of $130 video-camera sunglasses; the company’s first physical product. The company is also popular for its reach with millennials, as about 60% of their active users are aged between 13 and 24. It’s a novel way for advertisers to reach this sought-after age group.

Could Snapchat’s IPO potentially even revive the IPO market? With a successful listing, other tech companies such as Uber and Airbnb could be convinced to do the same thing.

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