Michael Lynton, the CEO of Sony Entertainment, Sony Pictures, and Sony America—the company has a rather complicated organizational structure—announced today that he will be stepping down from his positions to become chairman of Snap, the holding company behind Snapchat. According to a release from Sony, Lynton will step down this month to ensure a smooth transition for his successor.
The Wall Street Journal reported in November (paywall) that Snap had filed paperwork with the US Securities and Exchange Commission to begin the process of an initial public offering, which could be valued as high as $25 billion. Lynton, who has worked at Sony for 13 years and was previously CEO of AOL Europe and a vice president at Time Warner, has served on Snap’s board for nearly four years. He was an early investor in CEO Evan Spiegel when Snap was still just Snapchat.
“I have been involved with Evan and Snapchat since its early days, and given its growth since then, decided the time was right to transition and focus on my role as Chairman of the Board of Snap Inc,” Lynton said in Sony’s release.
Startups have long tapped “professionals” to help them transition into stable, long-term businesses. Facebook brought in former Google exec Sheryl Sandberg as its chief operating officer; Google brought in Sun Microsystems exec and Novell CEO Eric Schmidt to be CEO; and Apple brought in Pepsi CEO John Sculley to run the company (if only for a few years). Snapping up Lynton is the latest sign that Snap is preparing for life after an IPO.
Lynton could help Snap position itself as a social media company that knows how to work with the media and publishing industries, given his long history in both. Snapchat spends account for less than 4% of digital advertising budgets globally—Facebook and Google continue to dominate the market. But when Facebook went public in 2012, some analysts worried that it wouldn’t be able to compete with Google. Snap’s investors are surely hoping that, led by Lynton and Spiegel, the company can pull off a similar coup.
Still, Lynton will be an interesting fit in a modern, software-focused social company like Snap. After Sony’s email and servers were hacked in 2014, he took to sending his office communications by fax.