Prince Alwaleed Bin Talal of Saudi Arabia announced earlier this week that he has purchased $250 million worth of Snap’s class A shares, giving him a 2.3% stake in the company.
The stake was purchased gradually and it was completed on May 25th, according to Business Insider. Prince Alwaleed had purchased the shares at an average of about $11 per share.
Prince Alwaleed is a member of Saudi Arabia’s royal family and is involved in a number of entrepreneurial ventures. He has also invested in other technology companies such as Twitter, Lyft, and JD.com.
Prince Alwaleed had met with Snapchat CEO Evan Spiegel along with chief strategy officer Imran Khan in 2015. Both Snap executives visited Riyadh around that time to explore investment and business opportunities.
“Snapchat is one of the most innovative social media platforms in the world and we believe it has only just begun to scratch the surface of its true potential and we are blessed to be part of it,” said Prince Alwaleed in a statement.
Prince Alwaleed’s investment coincided with Snap’s second-quarter results. Snap generated most of its revenue through ad sales within the Snapchat app. Revenue for the quarter $262.3 million compared to analyst expectations of $249.5 million.
In the earnings call, Snap said that it moved its advertising products to a programmatic platform. In the past, Snap relied on the manual process of ad buying orders.
Snap’s chief financial officer Tim Stone said that 25% of ad revenue for the quarter was outside of the self-serve platform. One of the problems with the programmatic buying is the volatility of ad inventory prices. But this model has largely benefited companies like Google and Facebook.
Unfortunately, Snap reported another loss at $353.3 million for the quarter. And Snap also reported a decrease in the number of daily active users for the first time as a public company.
Prince Alwaleed’s investment in Snap was one of the first since he was released from custody back in January. Prince Alwaleed was one out of dozens of royal family members that were arrested by Saudi kingdom authorities due to alleged corruption. Prince Alwaleed was released after a financial settlement was made with the kingdom’s attorney general.