The disparaging remarks about the Indian market came to light after the unredacted version of the statement submitted by Anthony Pompliano, who is suing the company for malpractices, was put out by the organisation.
According to Anthony, at a 2015 meeting convened to discuss Snapchat’s expansion to potentially lucrative geographies, when he pointed out to Evan that the app was not performing to its full potential and could do better overseas, he was interrupted mid-sentence by the CEO, who went on to say, “This app is only for rich people. I don’t want to expand into poor countries like India and Spain.”
The allegations are contained in Pompliano’s lawsuit, filed in redacted form in L.A. Superior Court in January. On Monday, Snap Inc., the parent company of Snapchat, dropped its efforts to keep the unredacted complaint under seal and released it in a public filing.
Anthony has filed a lawsuit based on his three-week tenure at the company. In the lawsuit he has alleged that he found that the company was exaggerating its numbers about user data such as the registration and retention rates and that its top executives had been misled about key metrics.
The Snapchat CEO seems to completely overlooked the fact that India is not only the second largest smartphone market in the world, but also the fastest growing, when it comes to the number of handsets sold or shipped here. Even if the penetration isn’t promising in percentage terms, the sheer size of India’s population makes these numbers momentous. It is due to these stats that various overseas tycoons like Jack Ma and Jeff Bezos are pumping billions of dollars to capture market share in India.
As far as the user base of Snapchat itself is concerned, the app is said to have 4 million users in India as of last year, and the number will have definitely grown since then. WhatsApp has close to 200 million users here, a clear indicator of how much Snapchat can grow here, if a fitting amount of marketing dollars are spent here.
“What he uncovered was a wide-spread, systemic failure in Snapchat’s internal controls over its user data,” the suit claims.
In the almost 20-page-long statement, Anthony has accused the company of providing inaccurate information to investors and deliberately misguiding them. In a detailed report carried by Variety earlier this week, Snap, the parent company of Snapchat, claimed to have 100 million DAUs at the time, whereas only 95-97 million were confirmed by agencies. Even the number of users increased only by one percent to four percent quarter on quarter, which is less than the double-digit month-on-month growth the company claimed to be clocking.