Snap, owner of the Snapchat messaging app popular with teenagers, is to sell its shares on the US stock market.
The California-based tech firm, which allows users to send images and messages that vanish within seconds, is set to be one of the major US share listings of recent years.
The flotation is expected to value the business at between $20bn and $25bn, although Snap has never made a profit.
It will turn the company’s founders into multi-billionaires.
Snap wants to raise $3bn through the share sale, a small percentage but one that will set the market price for the rest of the company.
Snap’s formal announcement to regulators of its plans revealed that the company made sales of $404m last year, but a loss of $515m.
The documents also disclose that the shares being sold will, unusually, not carry voting rights, enabling Snap’s founders to retain control.
Snapchat: Is it really worth $25bn?
The company began in 2011 when co-founder and chief executive, 26-year-old Evan Spiegel, was still at university.
Mr Spiegel and fellow founder Bobby Murphy, 28, have stakes in Snap that would be worth about $5bn.
Snap now has nearly 160 million daily users and last year revenues grew by nearly 600%, the listing documents revealed.
Heavy costs, including from marketing and research, dragged Snap into even deeper losses than the $373m it lost in 2015.
Snap said in the filing that it expected “to incur operating losses in the future, and may never achieve or maintain profitability”.
Despite the losses – and that warning – some investors see Snapchat as the next potential Facebook, said CCS Insights analyst Martin Garner.
“If it can repeat the Facebook story to some extent, it’s going to be hugely profitable,” he said.
Most of Snapchat’s revenue comes from advertising, and it is seen as an appealing way for companies to reach young people, with over half of its users aged between 13 and 24.
Analysts predicted its US stock market listing would be the biggest since the launch of Chinese e-commerce giant Alibaba in 2014, and before that Facebook’s $81bn valuation in 2012.
It would also mean a big payout for Mr Spiegel, who is set to remain a major shareholder.
Just over three years ago, he turned down an offer from Facebook’s co-founder Mark Zuckerberg to buy Snapchat for $3bn.
The company is now seeking to raise $3bn from the share sale, according to reports, valuing the company at much more.
Snap names Facebook as one of several companies it is competing with for users’ attention, along with Twitter and Google-owned YouTube.
However, it is also seen as a fast-growing rival to those major Silicon Valley players.
Under pressure from Snapchat, Facebook has launched new filters and a slideshow feature on its photo-sharing app Instagram.
“A lot of people think Facebook is losing younger users to Snapchat. There’s a lot of evidence Facebook is copying Snapchat’s features,” Mr Garner said.
But with Facebook drawing in 1.2 billion daily users, Snapchat needs to prove it can have general appeal, he added.
Keen to show it can make revenue from sources other than advertising, Snapchat rebranded itself as Snap last year, and debuted its video-camera sunglasses called Spectacles.
The kit can connect to smartphones and send video and photos to the app.
Last month, the firm said it had established its non-US office in London.
Snap said it would pay taxes on UK and some international sales through the hub.
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