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How Jan Koum Steered WhatsApp Into $16B Facebook Deal
First time accepted submitter paulbes writes "Jan Koum picked a meaningful spot to sign the $19 billion deal to sell his company WhatsApp to Facebook [Wednesday]. Koum, cofounder Brian Acton and venture capitalist Jim Goetz of Sequoia drove a few blocks from WhatsApp's discreet headquarters in Mountain View to a disused white building across the railroad tracks, the former North County Social Services office where Koum, 37, once stood in line to collect food stamps. That's where the three of them inked the agreement to sell their messaging phenom –which brought in a minuscule $20 million in revenue last year — to the world's largest social network." Forbes overstates the apparent selling price by a few billion dollars; big numbers, either way. [Update: 02/20 13:51 GMT by T : The $19 billion makes sense, if you include retention bonuses in the form of restricted stock units.] Another reader points out the interesting fact that "Acton — himself a former Apple engineer — applied for jobs at both Twitter and Facebook way before WhatsApp became a wildly popular mobile app. Both times he was rejected."
Nineteen billion for a glorified instant messenger.
Facebook is going mobile - as are many (most) other players. This is one of the few mobile messaging networks that has a reach big enough to pull users away from Facebook. $19B is a reasonableamount of money to spend on defense to make a network that - internationally - is bigger than Twitter disappear as a risk.
Its not the revenue today, its the customer base (7% of the world population are regular users and its still growing rapidly). We're not used to international phenomenons like this, so of course the numbers look huge as absolutes. $38/customer is still a lot for a pure acquisition, so if they hadn't become large enough to be a credible threat they'd likely never have seen that much, but they did... and the rest is history.
You're special forces then? That's great! I just love your olympics!
They paid this amount for 450+ million users database from around the world their phone numbers, IMEI, MAC addresses, contact lists, ..... list goes on.
During the Holland Tulip bubble, tulips became worth enormous amounts and some, like a black tulip, were exceedingly. Reportedly, the owner of a black tulip bought what he believed was the only other black tulip in existence for a prodigious sum, and then crushed it with his foot. "HaHa! Now I have the only one!" (only in Danish).
whats.app had absolutely no intellectual property and it would take less than 1 million dollars to produce a polished work-alike. All the Facebook bought was it's customer list, nearly all of which probably already use facebook.
The tulip age has returned again. Pets.com zombies walk the earth.
Some drink at the fountain of knowledge. Others just gargle.
I like the part where they paint the guy as a food stamp collecting dude, but later in the article he 'lived off the 400,000 he had saved'. That is definitely not a poor person who has 400k laying around in bank accounts, at all.
I can't hear the "he started out poor" line anymore.
Yes, one in a million poor people make it. So what?
Assorted stuff I do sometimes: Lemuria.org
Am I the only person that had never heard of "WhatsApp" prior to news of this buyout?
Light travels faster than sound. This is why some people appear bright until you hear them speak.........