Tech

Investing in Snap is as irresponsible as 'driving drunk,' says NYU professor

Key Points
  • No responsible person would invest in Snap, NYU Stern Professor Scott Galloway said.
  • Facebook's Zuckerberg is determined to destroy the company, Galloway said.
  • Snap fell below its IPO price of $17 on Monday.
NYU Stern's Scott Galloway: Investing in Snapchat is like driving drunk
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NYU Stern's Scott Galloway: Investing in Snapchat is like driving drunk

As Snap sinks further below its $17 IPO price, one professor of business unloaded on the company.

"Investing in Snap is like driving drunk," NYU Stern Professor Scott Galloway told CNBC's "Squawk Alley" on Tuesday.

Snap Inc. is the "most overvalued company in the world," Galloway said. "I think [investing in it is] something no responsible person should do."

Morgan Stanley, one of the underwriters of the stock, downgraded Snap stock and slashed its price target to $16 from $28.

Galloway said Facebook can easily take a company like Snap out of the game.

"The first thing Mark Zuckerberg thinks when he wakes up is 'must wipe Snapchat from the face of the planet,'" he said, "and I believe the last thing he thinks before he goes to sleep is 'must wipe Snapchat from the face of the planet.'"

Facebook never faced the same level of competition when it went public and it was profitable immediately, he said.

The poor performance of recent IPOs such as Snap and Blue Apron — which has also dipped below its IPO price — raises the question of whether these companies can compete.

"It's better to be private right now because you're not subject to the scrutiny of the public markets," Galloway said.

Snap and Facebook did not immediately respond to CNBC's requests for comment.