Snap CEO Evan Spiegel thinks his company needs to focus on profitability in 2019

Evan Spiegel, Snap cofounder and CEOGreg Sandoval/Business Insider

• In an internal memo running over 6,500 words long, Snap CEO Evan Spiegel admitted the company moved too fast in 2018 — specifically referring to the controversial Snapchat redesign. 
• Spiegel set priorities for 2019, refocusing the company on the core principle of being the “fastest way to communicate.” 
• Reaching profitability in 2019 will also be a key goal for Snap. 

In a 15-page internal memo obtained by Cheddar, Snap CEO Evan Spiegel admits that it went too fast in releasing its controversial app redesign, and set company-wide goals for 2019 — including becoming profitable.

“In our excitement to innovate and bring many new products into the world, we have lost the core of what made Snapchat the fastest way to communicate,” Spiegel wrote.

The 6,500+ word memo was surprisingly candid for Spiegel, who describes himself as a shy person who feels awkward walking around the offices to chat. It is timely, however, as Snap’s stock closed below $8 per share on Thursday for the first time since going public in early 2017, as Facebook’s Instagram puts pressure on the business.

The drive towards profitability was a major theme in the internal memo.

To reach a “stretch goal” of breaking even by the fourth quarter of 2018, and to hit the overall goal of profitability by 2019, Spiegel said Snap will need to increase daily active users and user engagement — especially by growing in new markets like India, Indonesia and Brazil), improving ad measurement for advertisers to understand the value of their investment, and increasing the absolute number of advertisers.

The speed of the product was another major theme. Spiegel repeatedly emphasized the importance of Snapchat remaining the fastest way for people to communicate in order to build momentum in the company’s growth.

To that end, he says that the company will work on speeding up the Snapchat experience — Spiegel writes that he recently found that Snapchat was faster on an iPhone 4 from 2010 than on his iPhone X from 2017, and says that he wants to get back to that level of responsiveness. 

Notably, he didn’t back down entirely from the redesign, which had the internal codename “Cheetah,” and which was widely panned by users upon its initial release earlier this year. He wrote that while some reworking clearly needs to be done, it was generally the right move.

Indeed, he referred to 2018 being “the year of the Cheetah,” and announced that all employees will receive a cheetah-themed sweatshirt to commemorate the app’s seventh anniversary this year.

Representatives for Snap did not immediately return a request for comment. 

Read Spiegel’s full memo at Cheddar here.

Get the latest Snap stock price here.