Snap, the company behind messaging firm Snapchat, has announced it is making London the home of its non-US activity.
The move by the Los Angeles-based firm marks a significant departure from the approach taken by other US tech giants, which have set up their European base in neighbouring countries, such as Ireland, in a seeming attempt to benefit from lower-tax regimes.
A Snap spokesperson said: “I am happy to confirm that the UK is the Snap Inc family’s hub outside the US. The UK’s strong creative industries make this a great place to build a global business.”
The firm’s UK entity will benefit from the revenue generated by sales made to customers in the UK and to those in countries where Snap doesn’t have a local entity or salesforce.
Snapchat, which plans to go public this year with a valuation of up to $25bn, already has a three-story office in London’s Soho, but plans to open an additional site nearby. The company employs more than 75 people in the UK – up from just six this time last year.
Its offices outside of the US also include Paris, Sydney, Odessa (Ukraine) and Toronto.
Claire Valoti, general manager at Snap Group in the UK, commented on the decision: “We believe in the UK creative industries. The UK is where our advertising clients are, where more than 10 million daily Snapchatters are, and where we’ve already begun to hire talent.”
A vote of confidence
Philip Shepherd, partner at Taylor Wessing, said Snapchat’s decision provided a spell of good news for the UK’s burgeoning technology sector.
“It is great to see another vote of confidence for the UK as a global centre for business with the announcement that Snapchat will be opening its non-US headquarters in London,” he commented, adding: “Following a brief pause immediately after the referendum result last year we are continuing to see a number of exciting overseas technology businesses choose the UK for their European/International headquarters. Despite the uncertainty that will remain with us until we know what the future holds for the UK’s relationship with the EU, the underlying fundamentals that attract many businesses to the UK remain unchanged.”
The news comes after Apple announced the opening of its new HQ in London’s Battersea Power Station in September.