Snap, the parent company of the social network Snapchat, laid out a preliminary valuation for its highly anticipated IPO today in a regulatory filing with the Securities and Exchange Commission.

The maker of the disappearing-photo application puts its market value in the range of $16 billion to $18.5 billion. This is down considerably from the $25 billion it was initially predicting.

Still, that is quite a chunk of change for a company that is only five years old. But how exactly do investors set a price on a company like Snap?