One of the hottest startups on the planet right now is called Snapchat.
Snapchat makes an app that allows users to send each other videos and photos that disappear after a maximum of 10 seconds.
According to the Pew Research Center, 9% of all Americans who own mobile phones use it. Snapchat’s latest round of funding in June, $US60 million from IVP and others, valued the company at $US800 million.
And yet, in an interview published by the AP over the weekend, Snapchat CEO Evan Spiegel says he continues to live at home with his dad.
Asked in August, Spiegel answered that the “rent is cheap.”
At first glance, that’s a surprising answer.
Spiegel has plenty money for his own place.
As a part of that June funding, Snapchat’s investors allowed Spiegel and another cofounder to swap some of their stock for $US10 million in cash each.
Also, Spiegel probably makes a decent amount of money in salary.
According to a number of sources, startup CEOs typically make between $US60,000 and $US260,000 per year in salary.
Surely Spiegel could use some of that money to find a nice apartment near Snapchat’s world headquarters on Venice Beach in Southern California.
But here’s what you don’t know: Spiegel’s dad lives in a pretty sweet neighbourhood — one that would be a stretch to move into even for his 20-something multi-millionaire kid.
According to the Palisadian Post, Spiegel’s dad lives on Toyopa Drive in Pacific Palisades, California.
Go ahead, look that street up on Zillow. The top results are a $US10.5 million home for sale, a $US4.995 million home for sale, and a house you can rent for $US14,950 per month.
After taxes, Spiegel likely only cleared $US5 million or so from his sale of Snapchat stock this summer.
Why blow half of that on the cheapest house in an amazing neighbourhood where he can live for free? One that would probably be too big for him, anyway?
Just because you’re rich, doesn’t mean you have to be stupid.
(Obviously Spiegel has been lucky in life many times over, starting with the facts that his parents are well off and cared enough about him to send him to Stanford. People will want to tear him down for that. Let’s first take a moment to appreciate that he is shrewd and not obnoxiously decadent.)
Here’s a quick glance at Spiegel’s neighbourhood:
We reached out to Spiegel for comment. We’ll update this post if he gets back to us and says anything interesting.