Snap, the company behind the Snapchat app, revealed a host of information ahead of its IPO, including where it believes the future lies – and the challenges it faces.

“We believe that reinventing the camera represents our greatest opportunity to improve the way people live and communicate,” it said.

Snap’s documentation revealed that while Snapchat’s daily active users hit 158 million at the end of 2016, up 48 percent year-on-year, this has been accompanied by a growing loss.

Its net loss increased to $514.6 million in 2016 from $372.9 million the year before. Revenue for 2016 was $404 million, up from $58.7 million.

The firm is seeking to raise as much as $4 billion in the IPO, according to media reports, with a valuation of around $20 billion to $25 billion, making it the biggest US tech IPO since Facebook.

The filing pointed out that the app maker faces significant competition in “almost every aspect of our business” from more established companies such as Apple, Facebook, Twitter and Google, singling out Instagram Stories as a “feature that largely mimics our Stories feature and may be directly competitive”.

Among its big costs, Snap said it has committed to spend $2 billion with Google over the next five years to use its cloud computing services.

Its strategy is to “invest in product innovation and take risks to improve our camera platform”.

“We do this in an effort to drive user engagement, which we can then monetise through advertising. We use the revenue we generate to fund future product innovation to grow our business,” the filing continued.

It noted that “we have a short operating history and a new business model, which makes it difficult to evaluate our prospects and future financial results”, adding that this “increases the risk that we will not be successful”.

As previously reported, investors will not get voting rights, with founders Evan Spiegel and Robert Murphy retaining control.

They will have the “ability to control the outcome of all matters submitted to our stockholders for approval, including the election, removal, and replacement of directors and any merger, consolidation, or sale of all or substantially all of our assets”.

It has also been hiring aggressively. At the end of 2016 it had 1,859 employees, an increase of around 210 per cent year-on-year, and expects to continue hiring at “a rapid pace… to support potential future growth”.

“While not all of our investments will pay off in the long run, we are willing to take risks in an attempt to create the best and most differentiated products on the market,” it said.