SnapChat's product is not worthless, it just doesn't comprise much of the value of the company. People don't use SnapChat because of the product itself, they use it because of the brand and popularity among their friends.

Think about what an exact clone of SnapChat with no users or brand equity would be worth. Probably negative value to most of us, without distribution resources. It would be of some value to Facebook, but getting people to change behavior and gel around a new product is hard, even for Facebook.

So yes, the value of SnapChat, and most consumer companies, is not in the product itself.