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Meet the Aussie, Jeremy Liew, who made billions on Snapchat

John McDulingNational Business Editor
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A previously unheralded Australian technology investor has emerged as one of the biggest winners from the Snap float, booking billions in gains on his firm's stake in the disappearing messaging company, and catapulting himself into the ranks of the world's top venture capitalists.

Jeremy Liew, who grew up in Perth and graduated from the Australian National University in the early 1990s, was the very first investor in what was up until recently known as Snapchat. In 2012 he struck a deal to invest $US485,000 ($641,000) of his firm Lightspeed Venture Partner's capital into the company after fortuitously tracking down its founder (now Miranda Kerr's fiance) Evan Spiegel on Facebook.

Speaking to AFR Weekend from the US amid a maelstrom of media attention from the finance and tech press, Liew admitted the Snapchat investment would be a career defining deal, but said he was hopeful it would not be his last big hit.

Jeremy Liew, who grew up in Perth and graduated from the Australian National University in the early 90s, was the very first investor in what was up until recently known as Snapchat. Karine Aigner

"I'm 45 and I've been a venture capitalist for about 10 years," he said. "I would definitely be disappointed if the best years of my career were already behind me."

Snap, the self-styled "camera company", completed a blockbuster initial public offering on the New York Stock Exchange this week, selling shares worth $US3.9 billion to investors.

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Shares in the company best known for its ephemeral messaging service soared 44 per cent to $US24.48 on their first day of trading on an offer price of $US17, valuing the still loss-making business at $US34 billion.

Mr Liew's Lightspeed invested a total of $US8.5 million into the company before the IPO. It sold shares worth $US74 million this week, but has retained a stake worth nearly $US2 billion, based on the closing price after the first day of trading and regulatory filings. This means its profits on paper currently stands at almost $US2 billion.

"It's just another day at the office," Mr Liew said.

This week, the New York Times reported on a "spat" between Mr Liew and Snapchat's co-founders Evan Spiegel and Bobby Murphy. The report claimed the terms of Lightspeed's initial investment gave it veto power over subsequent funding rounds, jeopardising further investments into Snap from other venture firms and upsetting Mr Spiegel.

Snapchat co-founders Bobby Murphy, left, and CEO Evan Spiegel ring the opening bell at the New York Stock Exchange. Richard Drew

But Mr Liew played down the report. "I think it was a bit overblown. In any five-year relationship there are going to be some points of friction, we had some disagreements and we resolved them. He [Spiegel] is an extraordinary founder, product visionary and leader."

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Mr Liew, who has lived in the US for 20 years and is now a dual citizen, still has the remnants of Australian accent. He still identifies as an Aussie, and his parents still live in Perth.

A graduate of Duncraig Senior High School in Perth and the Australian National University in Canberra, where he studied linguistics and pure mathematics, Mr Liew began his career at McKinsey & Co in Sydney. In 1996, he moved to the US to work for online information portal CitySearch.

The investment in Snap - surely one of the greatest investments ever involving an Australian - will now go down in tech and finance folklore. As Mr Liew has been recounting to media outlets across the US in recent weeks, the deal came about after a tip from fellow a Lightspeed partner Barry Eggers, whose daughter was engrossed in the app.

Millennials are underserved in finance.  AP

After much sleuthing online, Mr Liew figured out Mr Spiegel was behind the app and contacted him on Facebook. At the time Mr Liew's Facebook profile picture was of him with US President Barack Obama (he'd recently attended an Obama fundraiser) which apparently convinced Mr Spiegel, who was struggling to pay server bills due to Snapchat's rapid growth, of his bona fides.

"We set up a meeting for the next day, and about two weeks later we signed a termsheet to lead the first round of investment in Snapchat. It's been an amazing ride ever since" Mr Liew said.

And the rest, as they say, is history.

Mr Liew's blockbuster bet on Snapchat comes at a time when interest in venture capital and startups in Australia has reached fever pitch. "I know that there are a lot of great companies coming out of Australia these days," Mr Liew said. "It is night and day from when I left in the mid 90s."

John McDuling is National Business Editor for The Sydney Morning Herald and The Age. Connect with John on Facebook and Twitter.

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