Snap CEO Evan Spiegel isn’t exactly impressed with rival Mark Zuckerberg’s larger metaverse vision.
In fact, like many pundits and tech fans, he isn’t entirely sure of its purpose.
When asked about the Facebook founder and CEO’s Metaverse vision at the Code conference on Wednesday, Spiegel dryly chuckled that he was “trying to figure out what it meant.”
The two companies are going head-to-head when it comes to competing for technological advances and the attention of social media users—but both face challenges.
Last month, Snap announced it was cutting 20% of its workforce, and a frosty digital advertising landscape and poor earnings reports have caused its stock to drop more than 75% this year.
Spiegel admitted at the Code conference that layoffs were the only viable option for the company to restart growth, given the current economic climate.
Snap’s recovery strategy
Despite the turmoil, Snap has a strong user base of about 350 million daily active users, and the firm is doubling down on efforts to give itself a new lease on life.
The company has embarked on a strategy called Project Sunshine to revive the ill-fated engagement with parts of the Snapchat platform, business Insider reported this week, while a leaked internal memo revealed Wednesday that Snap is aiming to increase user numbers by about a third before the end of next year, setting a $6 billion revenue target for 2023 .
Spiegel said Wednesday that Snap’s recovery would be “difficult” because the business was “small compared to these other very, very large companies” — but he ruled out the possibility of Snap being acquired by a bigger player.
“These other very large companies also started out as smaller companies,” he said. “They faced a lot of volatility and a lot of challenges. That’s the difficulty of building an independent business. but [we] We believe the best way to realize our long-term potential is by building an independent company.”
Meta ‘A very challenging competitor’
Spiegel on Wednesday acknowledged the difficulty of competing with rising social media star TikTok, but told viewers in code that Snap’s biggest rival was a more traditional firm.
“Meta remains a huge and challenging competitor,” he said.
Meta—the company formerly known as Facebook, which owns the flagship Facebook platform as well as Instagram and WhatsApp—said last year that it was planning to shift its focus toward building the virtual reality metaverse. As was rebranding.
Last year, the social media giant invested $10 billion in building the Metaverse, a digital space where users can experience and interact with others using VR technology.
However, while Meta has major spending power behind it, Spiegel said on Wednesday: “What gives me great hope is that historically, spending large amounts of money is not always a predictor of success. “
Last month, Zuckerberg was mocked around the world after posting an image from the Metaverse that became known as a “$10 billion selfie.”
Meta, like Snap, is tackling its problems on top of doubts over its Metaverse efforts, and has seen its stock price drop more than 50% so far this year.
sign up for Fortune Features Email list so you don’t miss out on our biggest features, exclusive interviews and investigations.
