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Facebook Buying WhatsApp for $16B in Cash and Stock Plus $3B in RSUs

• minimaxir 13y ago
  Suddenly Snapchat at $3B doesn't seem so ridiculous.
  • psbp 13y ago
    They both seem ridiculous.
    • asselinpaul 13y ago
      no, I can see how Snapchat is unique and fresh. WhatsApp brings nothing new to the table.
      • midas007 13y ago
        ARPU vs CTLV doesn't compute. This is like déjà vu, circa 2000 when I was watching the {{decent}}.corp ticker hitting $60/share after 3 splits. If anything I don't feel that Justin Frankel and "Mr. Wonderful" made out like bandits as much now. ProTip to new startup people: now is not the time for your magic mobile IM app. Most potential acquirers' demand is likely sated, making the value of the remaining players in the space effectively zilch, apart from lower cost acquihires and fodder for opening pitch jokes.
        • wpietri 13y ago
          I want to underline that last point. Doing something that is fashionable is a bad idea. Doing something that was fashionable and whose big players are now getting snapped up is a terrible idea.
      • yeukhon 13y ago
        To be fair, WhatsApp came wayyy before Snapchat came. WhatsApp is well-established and is charging users (at such a low price). SnapChat is hot. But that being said, 16B for WA is still a ridiculous number to me.
      • 650REDHAIR 13y ago
        WhatsApp brings Asia, Africa, and South America to the table.
        • allsystemsgo 13y ago
          Dude I have no idea why no one is recognizing this.
• Karunamon 13y ago
  Welp. There's another app that I won't be accepting any updates for from now on...
  • yulaow 13y ago
    Same here. Facebook has already showed his ability to ruin things instantly.
    • skeletonjelly 13y ago
      I'm no Facebook fan, but this isn't entirely true is it? I mean Instagram has pretty much stayed the same. It gained a video feature. Otherwise the same?
      • shurcooL 13y ago
        They ruined Divvy after buying it.
        • cemregr 13y ago
          What is Divvy? If you mean Divvyshot I thought it was a talent acquisition.
          • shurcooL 13y ago
            Yes, sorry, I meant Divvyshot. It solved a certain popular problem very nicely, and now there is no longer an equal offering.
  • karl_gluck 13y ago
    I would agree, but if you don't update WhatsApp it disables itself after a week or so.
  • diminoten 13y ago
    I'm glad people are finally realizing what they're giving up for convenience. I personally don't mind having no privacy if everything becomes super convenient, but at least people are cognizant of the tradeoff now.
• higherpurpose 13y ago
  Such a waste. Most Whatsapp users already use Facebook in parallel. Facebook will never see a ROI on this acquisition. Not even close.
  • minimaxir 13y ago
    I wouldn't think of this from a ROI perspective. Facebook might be trying to go for the monopoly on mobile messaging. And once Facebook controls that, they can do anything.
    • roc 13y ago
      Or they simply don't want/can't afford seeing large chunks of users move their usage away.
    • nilkn 13y ago
      Buying WhatsApp isn't going to help too much there. SnapChat is still gaining steam and it won't be long until there's another serious competitor on top of that. The market has shown time and time again that in the messaging world it's extremely hard for one force to stay dominant for too long. Unless this pattern suddenly breaks today, Facebook will continue having to shell out many billions to keep buying these companies. I'm not convinced Facebook's profit is enough to keep that up.
  • traskjd 13y ago
    Not saying this is the absolute case, but sometimes these things are defensive plays (e.g. instagram was starting to control more % of photographs - something that is pivotal to Facebook's continued success). Sometimes the ROI is in retaining your value and not dying, as opposed to getting $$ out of the investment. I'm guessing if you want to be the #1 social network for a long time, you don't want people being social outside your platform. I'd put this purchase in the defensive bucket.
  • Karunamon 13y ago
    What makes you think that? Facebook already has its own messaging platform, while Whatsapp advertises themselves as a direct replacement for SMS.
• deleted 13y ago
  [deleted]
• tzury 13y ago
  This will be the largest Israeli Startup Exit of all times I think.
  • dudus 13y ago
    Waze was a great Israeli exit as well.
  • prostoalex 13y ago
    Isn't WhatsApp in Mountain View, CA?
    • smackfu 13y ago
      Founded by ex-Yahoo people too.
  • tomerico 13y ago
    You're probably mixing Whatsapp with Viber which has sold a few days ago for $900M
• matthewhelm 13y ago
  "$4 billion in cash and approximately $12 billion worth of Facebook shares"
• deleted 13y ago
  [deleted]
• vladgur 13y ago
  Wow, thats an incredible return on a $8m sequoia investment http://techcrunch.com/2011/04/08/sequoia-whatsapp-funding/ http://techcrunch.com/2011/04/08/sequoia-whatsapp-funding/
• nkuttler 13y ago
  Good for them! Now on to uninstalling it :-(
  • taternuts 13y ago
    As someone who installed it to see how it works and rarely uses it, this is the first thought that crossed my mind
• gamegoblin 13y ago
  That is a LOT of money. That being said, I use WhatsApp every day to chat with my friends around the world and it's really excellent. I know it's used a lot in other parts of the world even more, so I doubt this purchase is focused on US markets. It seems that every one of my Arab friends uses WhatsApp to talk to their families back home (and they use it at home, too). I don't know about other regions.
  • jpablo 13y ago
    WhassApp is the standard in Mexico. It replaced Windows Live (MSN) Messenger after they killed it by trying to make everybody switching to Skype and the interest of the people shifted to mobile.
    • riffraff 13y ago
      AFAICT it's become the standard in italy too. People use it way more than facebook now, judging by my contacts (and I don't even use it, I just see a bunch of people doing it).
    • MichaelGG 13y ago
      MSN had 350 million active users a few years ago. And they just pissed it into oblivion. MSN had Skype feature set before Skype, but did nothing to publicize it. And also, think - MSN had everyone's friends info, as well as frequency of contact and so on. It would have been a perfect way to launch a real social network. MSN fumbled that too. A comedy of errors.
  • ijuarez 13y ago
    here in Peru the same, it is the standard app to chat
  • smtddr 13y ago
    Standard with all the cool people in Nigeria.
  • dfjorque 13y ago
    Also standard here in Chile. FB Messenger is somewhat common as well, but WhatsApp has the largest following by far.
• meric 13y ago
  They might as well go ahead and buy WeChat as well.
  • naterator 13y ago
    Actually, now that's an aquire I think would be worth $16/19B. WeChat is f-in huge in China. And they use it for everything, including payments.
    • cookingrobot 13y ago
      WeChat is made by Tencent, who's market cap is $143B.
  • Cookingboy 13y ago
    Buying Tencent? That's gonna cost them a bit more than this...
    • mindotus 13y ago
      Looking at the market cap, it's around $128 Billion USD.
  • humannature 13y ago
    they can't, it's owned by Tencent which has a $100B+ market cap.
• falsestprophet 13y ago
  Some interesting numbers: WhatsApp raised only $8 million (from Sequoia in 2011 http://www.crunchbase.com/company/whatsapp http://www.crunchbase.com/company/whatsapp). 19B sale price is about 10% of Facebook's 173B valuation. At 400 million, WhatsApp has more users than, the world's third most populous country, the United States has residents.
  • robryan 13y ago
    Wow, that sure is going to be a massive result for Sequoia.
  • antr 13y ago
    It just shows that all those Series A/B rounds at $15m-$20m won't buy you traction nor success. Or as many VCs would say "the market wasn't ready"
    • rokhayakebe 13y ago
      I wish your comment found its way to the top of the main thread.
  • chrislloyd 13y ago
    Assuming Sequoia took that for 20% of the company (fairly standard), they just made $3.2bn. For every $1 they invested in WhatsApp, they made $400 back. </napkinmath> However people feel about the VC game, 400x IRR are why so many people play.
    • ojbyrne 13y ago
      Minor quibble: IRR is usually an annualized measure. I come up with a number just over 7x (assuming 3 years, cube root of 400-1). Not that it makes it any less insane.
      • rahimnathwani 13y ago
        Another minor quibble: IRR is usually expressed as a percentage (e.g. 700% per year rather than 7x).
• samolang 13y ago
  This seems insane. I love WhatsApp, but I recently switched to Google Hangouts because it also supports SMS and I don't really miss it. I don't understand how it can be worth this much when Google has already released a direct competitor to its product that is (and likely always will be) free.
  • smackfu 13y ago
    Network effects. When everyone has to switch to a platform, it's hard. And Whatsapp is free for the first year, which is enough to get people stuck on it.
• antr 13y ago
  I used WhatsApp to stay away from FB's chat app. Telegram is picking up popularity within my circles... I'll default to that
  • carlozt03 13y ago
    How'd you get your friends to move over to Telegram? I'm trying to get that ball moving with my circle of friends.
    • antr 13y ago
      I didn't... they started showing up on my contact list. I then found out that they read about the app on the newspaper.
    • malandrew 13y ago
      Better yet, how do we get people to move to something distributed so that Facebook (or Google or anyone else) cannot acquire the service. If we just move to another decentralized messaging service, that service will eventually get gobbled up as well, and we'll have to rinse and repeat.
      • morganherlocker 13y ago
        I suppose that is its own form of decentralization.
      • roc 13y ago
        Even distributed protocols aren't a silver bullet. Embrace and extend can make short work of that. As can joining standards boards and playing political games. As can simply turning off federation. Sometimes I think HTTP and SMTP are only limping along because there's a large enough enterprise base that doesn't want to see any changes at all. Maybe that presents a defense (get your competing protocol entrenched in corporate IT), but not many technologies get birthed out to the consumer space from the enterprise space the way http and smtp did.
      • qq66 13y ago
• blackaspen 13y ago
  Damn. I know Whatsapp is a big deal -- when I was in HKG a few weeks back every advertisement was Phone Number and Whatsapp number (We're talking on-bench advertising) and on TV as well. Still, crazy.
  • snogglethorpe 13y ago
    It seems very country-specific... In east asia generally, China (ex HK), Taiwan, Japan, Korea, etc, whatsapp doesn't seem to have much presence compared to LINE / kakaotalk / wechat...
• jljljl 13y ago
  http://blog.whatsapp.com/index.php/2012/06/why-we-dont-sell-ads/ http://blog.whatsapp.com/index.php/2012/06/why-we-dont-sell-...
  • techaddict009 13y ago
    Seems like by tomorrow this blog post well get deleted from the blog!!
    • kevincrane 13y ago
      WhatsApp seems to think themselves above ads still. If they're lucky it'll stay that way. http://blog.whatsapp.com/index.php/2014/02/facebook/ http://blog.whatsapp.com/index.php/2014/02/facebook/
      • eitland 13y ago
        They have a working business model with a whole lot of happy customers that pay yearly. I really hope to be able to pay for WhatsApp next year as well, I really loved it for what it was.
  • varenc 13y ago
    according the WhatsApp blog, its going to be staying ad-free. http://blog.whatsapp.com/index.php/2014/02/facebook/ http://blog.whatsapp.com/index.php/2014/02/facebook/
    • dictum 13y ago
      In the usual the current iteration of our product will stay ad-free, but we'll release a new version later and everyone will have to switch to it way.
    • yapcguy 13y ago
      Yeah yeah yeah. Heard this one before. Acquired company says it's business as usual, nothing will change, and then 6 months later things slowly begin to change and then after the vesting period of the acquisition finishes, and the newly minted sail off into the sunset, it all goes to hell.
• berzniz 13y ago
  I wish they didn't sell. Love the product, FB will ruin it.
  • patrickaljord 13y ago
    Why would they ruin it? They didn't ruin instagram. I'm not a fan of facebook but I don't agree here.
    • berzniz 13y ago
      It just can't be the same under Facebook. It's a matter of time until my whatsapp entity and my Facebook entity (I don't have one today) will merge. Same thing as Google tries to do with Youtube users. It just doesn't make sense to have two types of users in your system.
      • danabramov 13y ago
        Did this happen to Instagram?
  • asselinpaul 13y ago
    Why do you love it? I'm honestly curious as to what it does that SMS, Messenger or other messaging apps don't do.
    • namenotrequired 13y ago
      It's cheaper than SMS for most people, and it's what everyone uses.
    • ebrenes 13y ago
      I get charged a fee per SMS, but I just need an internet connection with WhatsApp. Even when I'm abroad and I switch my SIM card to a different provider contacts can still reach me. I can have group chats in WhatsApp and send video, images and sound. Plus I like how it lets me know if messages have been delivered. It's also fast and doesn't drain my battery mercilessly. The times I've tried Skype on my mobile device I can see my battery meter go down as I type. But mostly I use it because all of the people I generally interact with in real life are on it. All of my family, friends and acquaintances use it.
• NDizzle 13y ago
  $16B for something I've never even heard of. I feel like I'm living under a pile of rocks.
  • jturolla 13y ago
    you are.
    • jbeja 13y ago
      Whatsapp is everywhere in Venezuela, feel like the only one that is not using it.
  • gms 13y ago
    Don't feel bad; no one really uses them in the US (except us foreigners to communicate with friends and family abroad). They are the de-facto messaging service in the rest of the world (except for China).
    • gamegoblin 13y ago
      Definitely. None of my US friends have heard of or use it, but I have a ton of friends abroad and it's the only way we stay in touch.
    • dba7dba 13y ago
      Not true. KakaoTalk is big in S Korea. LINE is big in Japan. Quick check shows of 300 million registered LINE users and 50 million are in Japan.
      • sentenza 13y ago
        And Orkut was number one in Brasil, but in the end, the network effect doesn't care for cultural borders (with the exception of the Great Firewall).
      • tostitos1979 13y ago
        My wife uses Kakao and she got me on it too. The app works well and it is cute. I thought it was hilarious how they monetize with stickers. Then, I realized ... holy sh*t ... this is worth a billion!
• tool 13y ago
  Great, the only way I was able to stay in contact with people without using facebook is gone. Cancer.
• techaddict009 13y ago
  Seems like Mark Zuckerberg is turning crazy day by day!!
• ezrameanshelp 13y ago
  Zuckerberg just announced via Facebook profile: https://www.facebook.com/zuck/posts/10101272463589561?stream_ref=1 https://www.facebook.com/zuck/posts/10101272463589561?stream...
• hatred 13y ago
  Today , I feel I am really bad at maths counting return percentages. Sigh $8m -> $16b.
  • Cookingboy 13y ago
    I did it this way: 100x return is 800M, 200x return is 1.6B, so 16B is 2000X return, which is 200,000% return in initial investment. I think it's less than that though, since obviously Sequoia didn't get 100% of the company for their 8M, I think they walked away with 2.4B after this deal?
    • vassvdm 13y ago
      Whatsapp raised another 50m from Sequoia after those initial 8m
• deleted 13y ago
  [deleted]
• siliconbeach 13y ago
  http://d.pr/i/2LPx http://d.pr/i/2LPx Mark's post about it.
• yeukhon 13y ago
  16B? That's a B, people. While there are a lot of whatsapp users (and people have to pay to use it), wow, that's still a lot of money! How can they justify revenue that way? How can any company ever consider such acquisition? I don't even think Google can even make 16B like this. See this discussion: http://www.quora.com/WhatsApp-Messenger/How-much-revenue-is-WhatsApp-generating http://www.quora.com/WhatsApp-Messenger/How-much-revenue-is-... $20M net revenue, at most, right? With future expansion and side commercial services, I make $1B per year, fine. But that's after tax. So WhatsApp must make A LOT more than $1B. I really don't see anything else. But that's only when WhatsApp can continue to grow and actually gain that much of commercial income. Someone who have dealt with acquisition tells me how 16B is the right number. I would pay $5B just because WhatsApp is well-established.
  • ilteris 13y ago
    Facebook is trying to own mobile, period. That's all that matters to them and they are doing whatever they can to do it now, when it is still relatively early.
  • discardorama 13y ago
    Whatsapp charges $1/year IIRC. So, with 400MM users, you can expect ~$400MM/year revenue?
    • pyrrhotech 13y ago
      AFAIK that's only the plan. right now they have very little if any revenue. People use Whatsapp because they are too poor to afford text messaging. My guess is that lots will leave even at 1 USD per year
      • paraboul 13y ago
        Too poor? No. User experience, group messaging, fast picture upload.
    • yeukhon 13y ago
      There are 450M not 450MM. What is the double MM doing there? Sure but then minus the operation cost, tax, etc. You get down to very little. I don't dispute FB can turn it into a revenue machine by "inventing" a new way of looking at mobile and mobile messaging, but at this stage I am afraid the revenue that I read from Quora doesn't justify a 19B total acquisition. The price is too high; Twitter is about 40B ~ 50B (http://blogs.wsj.com/moneybeat/2014/01/03/twitter-near-70-valued-at-38-billion-or-49-billion/ http://blogs.wsj.com/moneybeat/2014/01/03/twitter-near-70-va...). So WhatsApp is at least 1/3 to 1/2 of Twitter, depending on how you look at it. And we probably can agree Twitter, FB are all about # of users; unlike Google which makes 60B revenue in 2013, Google has a real revenue model + user base. If you sell Google for $100B I won't even complain and I probably think that's a big bargain. (http://qz.com/137191/googles-record-valuation-is-still-130-billion-short-of-apples/ http://qz.com/137191/googles-record-valuation-is-still-130-b...)
• napoleond 13y ago
  How many active users does WhatsApp have? I'm trying to put this in perspective with the Instagram purchase and the Snapchat offer... finding it very difficult to understand the math behind this acquisition, although it is obviously linked to the recent plays with Messenger.
  • smackfu 13y ago
    430m active users and 18bn messages sent per day.
  • dandroid17 13y ago
    400 million http://blog.whatsapp.com/index.php/2013/12/400-million-stories/ http://blog.whatsapp.com/index.php/2013/12/400-million-stori...
    • smackfu 13y ago
      A month later: http://techcrunch.com/2014/01/20/whatsapp-dld/ http://techcrunch.com/2014/01/20/whatsapp-dld/
• almosnow 13y ago
  Damn, from any viewpoint you want to see it, just damn.
• gailees 13y ago
  HOLY SHIT!
• calcsam 13y ago
  This deal isn't so that Facebook can sell ads. This deal is so that Facebook can protect its flank and simultaneously assault Google.
• nwh 13y ago
  400,000,000 active users [0] 16,000,000,000 USD ---- $40 per user That's an incredible cost. We can assume Facebook is paying for the userbase, the app itself and it's infrastructure would basically run itself. It's less appealing when you realise that there's probably a miniscule fraction of WhatsApp users that don't have a Facebook account. > WhatsApp will remain autonomous and operate independently. You can continue to enjoy the service for a nominal fee Now it makes even less sense. [0]: http://blog.whatsapp.com/index.php/2013/12/400-million-stories/ http://blog.whatsapp.com/index.php/2013/12/400-million-stori...
  • hackinthebochs 13y ago
    I conjecture that this price is a reflection of the fact that facebook realizes their stock is way overvalued, and so they used this opportunity to make a huge purchase which would be too expensive otherwise. The fact that a huge amount of the purchase price in stock is a strong signal for this. These same sorts of deals happened in the first internet bubble (although this is clearly different as there is also a huge amount of cash changing hands).
    • jacklionheart 13y ago
      This doesn't make much sense to me since most of the transaction was in cash.
      • jeroen 13y ago
        No, it isn't: "The deal is being cut for $12 billion in Facebook shares, $4 billion in cash and an additional $3 billion in RSUs for employee retention." 21% cash.
    • bradleyjg 13y ago
      The biggest shareholder hero of dotcom 1.0 was Steve Case buying a real company (Time Warner) with bubble shares. But is whatsapp Time Warner? $1/user/year even with a huge user base is still not that much revenue.
• bedhead 13y ago
  When these bubbles really get crazy, you start questioning your sanity and wondering whether maybe you're just plain wrong. You actually start wondering if the valuations are justified after all, whether it be a house, stock certificate of a tech company, the mineral rights to some acres in the Haynesville shale, or some land on the Vegas Strip. My head hurts.
  • nilkn 13y ago
    To be fair, WhatsApp has an incredible number of very active users. It's not like the companies in 1998/99 which had no revenue, no users, but spent millions on Super Bowl ads. That said, this is a staggering amount to pay. I'm not familiar with Facebook's financials, but I'm surprised they could even afford this. I'd chalk this up to Zuckerberg's paranoia about no longer being #1 and less to a bubble.
    • adventured 13y ago
      WhatsApp has no serious revenue, the valuation is similar to the dotcom bubble in financial terms. Companies in 1998/99 weren't lacking in users. ICQ was purchased for $400 million in mid 1998, and had over 80 million users a year later (over 100 million by 2001). It too was run by a thin team, of just 70 people total (quite the accomplishment considering the technology of the time).
      • nilkn 13y ago
        Perhaps you're right. I was thinking more of companies like Pets.com and less of ICQ, though obviously ICQ is a much more direct analogue to WhatsApp today.
    • teacup50 13y ago
      > It's not like the companies in 1998/99 which had no revenue, no users, but spent millions on Super Bowl ads. It's not? They had users back then, too.
      • 13y ago
• dylanjha 13y ago
  How much revenue does WhatsApp have?
• flyinglizard 13y ago
  Clearly this is an anti competitive move. Both functionality and users overlap with FB's own products. So, for how long can FB pay billions a year to keep competition out of the market, when the barriers to entry are so low (as Snapchat and Instagram both demonstrated)?
• stfu 13y ago
  Love whatsapp, hate Facebook. As soon as they are trying to integrate whatsapp with Facebook I'm deleting that thing.
• chaz 13y ago
  Just 50 employees. http://blog.whatsapp.com/index.php/2013/12/400-million-stories/ http://blog.whatsapp.com/index.php/2013/12/400-million-stori...
  • ggreenbe 13y ago
    And 32 of them are engineers - http://sequoiacapital.tumblr.com/post/77211282835/four-numbers-that-explain-why-facebook-acquired http://sequoiacapital.tumblr.com/post/77211282835/four-numbe...
  • smackfu 13y ago
    Selling ads takes a lot of staff. So not selling ads...
  • FryHigh 13y ago
    $3bn to be given to WhatsApp staff! Lion share goes to the founders but wow!
• pcocko 13y ago
  It's a bubble. I don't beleive it can sustained over time. So simple apps sold for huge quantity of money
  • abc_lisper 13y ago
    I can't believe it either. Few miles from FB and Whatsapp is Tesla, people consider it massively overvalued at 25Billion. It is almost laughable. When you are a compulsive liar, people catch up to it, and you will all live in a lie world. This is very close to how Ponzi schemes work. Billion is a lot of money. Since FB lied through their teeth, considered themselves demigods and levied idiot tax on poor investors, it is their time to turn around and take it in the rear. Come on guys. 16B$?
    • frandroid 13y ago
      What lies are you talking about?
      • abc_lisper 13y ago
        I view FB as a very dishonest company. Here are my reasons. 1) Hiding stuff from users, stuff that is personal to users and putting it for sale. It is not like they make it easy to change options either. 2) Mark said on more than one occasion that he wants to make the world a open place. His actions don't reflect it. Remember, the one time somebody hacked into his FB account(or somehow got access to pics) and posted his personal pics, and FB was not too pleased about it. There was even a press release about respecting his privacy(!!). 3) Not too long ago, FB made ties with Republican faction for H-1B visas. Not too wrong with it(I am on H-1B myself), but they supported a Republican bill that has to do with environmental protection(went against it), to gather support for H-1B visas. It's almost like they would go to any lengths to get their stuff done. I find it hard to believe they(FB) have idealistic goals.
• tomkarlo 13y ago
  The fact that FB chose to pay $12BN in stock for this tells you something about what they think of their current valuation.
  • tomkarlo 13y ago
    That's a lot of money for an app with relatively little lock-in and a $0.70 (maximum) ARPU.
    • mschuster91 13y ago
      The lock-in is the network effect, and well, if you're aiming for 1-1.5B users (which can be served with virtually no employment and hosting costs) you're looking at 1B $ yearly profit.
      • tomkarlo 13y ago
        Not sure how you're figuring that. At best - 1.5Bn users locked in - you're at less than $1bn _revenue_ (after you net-out the 30% that goes to Apple or Google for an in-app transaction) and much lower net profits (presumably, it costs some fraction of a dollar in ops, bandwidth and cpu to support a paying user for a year.) Also, even at $1bn in revenue, this is 16X sales... that's usually the kind of price you'd see for a company that can still grow a lot. When you have 1/12 of the world's population as users, and you're capped at $1 per year per user, there's not a lot of places to grow. Clearly FB valued this based on strategic value to their broader platform.
        • antrix 13y ago
          > and you're capped at $1 per year per user Why would that be the case? There are always other revenue streams to be explored using the same user base.
          • tomkarlo 13y ago
            Maybe, but they're also entirely speculative. We can only evaluate the price based on the business they have, not imaginary alternate revenue streams.
• gailees 13y ago
  Email is dead.
• peteridah 13y ago
  WhatsApp has become the defacto medium of communication with my friends and family in Africa, emerging way ahead of phone numbers, sms, facebook et al. I am not thrilled by the service, but if you want to stay in the loop, you have to join the bandwagon.
• tomblomfield 13y ago
  Sequoia just landed a 5x return on their fund with this one deal. At a rough guess, they put in $8m for 15% of the company in 2011, valuing it at around $53m. A $16B sale is a 300x increase in value, so Sequoia's stake is worth $2.4bn. Their standard fund size is around $500m. http://www.reuters.com/article/2013/08/16/us-sequoia-funds-idUSBRE97F0WW20130816 http://www.reuters.com/article/2013/08/16/us-sequoia-funds-i...
  • selectodude 13y ago
    Not too bad for the two founders then. 6.8 billion dollars each.
    • cortesoft 13y ago
      There are surely a lot of other shareholders besides the founders and sequoia.
      • selectodude 13y ago
        They only received 8 million in funding though.
        • 650REDHAIR 13y ago
          "They decided to hold a second funding round, in secret. Sequoia would invest another $50 million, valuing WhatsApp at $1.5 billion." [0] http://www.forbes.com/sites/parmyolson/2014/02/19/exclusive-inside-story-how-jan-koum-built-whatsapp-into-facebooks-new-19-billion-baby/2/ http://www.forbes.com/sites/parmyolson/2014/02/19/exclusive-...
  • foobarqux 13y ago
    Would investment necessarily be limited to one fund?
    • the_economist 13y ago
• wudf 13y ago
  At least we'll still have viber
  • MichaelGG 13y ago
    Viber was just bought last Friday for $900M by Rakuten.
    • pbhjpbhj 13y ago
      >"Rakuten, Inc. is a Japanese electronic commerce and Internet company based in Tokyo, Japan. Its B2B2C e-commerce platform Rakuten Ichiba is the largest e-commerce site in Japan and among the world’s largest by sales." [Wikipedia] //
  • deft 13y ago
    What about BBM? Personally I prefer it over Viber and WA, and I'm pretty sure it has the same feature set. It also at least brags about being secure (no clue if it truly is)
• vassvdm 13y ago
  This is fascinating. To think I was trying to convince people that MySMS was better than Whatsapp...
• idleworx 13y ago
  And goodbye WhatsApp. It was time to move on anyway.
• riveralabs 13y ago
  It's official. Facebook is the new Yahoo. Buying a lot of companies at ridiculously extreme premiums.
• return0 13y ago
  Is that a record price or something?
  • vassvdm 13y ago
    It's the current record for the acquisition of a venture-backed startup
• rokhayakebe 13y ago
  Instead of stating the obvious, or hating, and congratulating, it would be nice to hear your thoughts on the value of this deal, what FB will gain, where do you see the IM space heading, could this be a Youtube like acquisition, etc...
• primitivesuave 13y ago
  My uncle in India runs a construction company, and literally every single aspect of company communication is done over WhatsApp. Each construction site has to constantly post pictures on WhatsApp, and basically all management and payroll decisions are made through WhatsApp discussions. Apparently this is not an uncommon practice, as businesses that were once administered by pen and paper are now using WhatsApp to improve efficiency and reach new customers.
  • my_username_is_ 13y ago
    That's amazing. It can be easy to write off WhatsApp with an ethnocentric view, but to hear how other people are using it on the other side of the world certainly adds a new perspective
    • virjog 13y ago
      Same thing with the diamond merchants in India. A lot of deals and much of the communication is now done over WhatsApp. People in India get a smartphone for the sole reason to use WhatsApp, whether the individual is a servant or a rich businessman.
      • crucialfelix 13y ago
        Also I noticed these Tata "WhatsApp data packs"; so they did partnerships directly with mobile providers. 30m actives in India.
  • kpennell 13y ago
    I was amazed how big whatsapp was in India and now in Mexico. Cool story.
  • pbhjpbhj 13y ago
    It's interesting to note from Whatsapp legal info that they say it's only for USA based users. cf my comment https://news.ycombinator.com/item?id=7267310 https://news.ycombinator.com/item?id=7267310 or http://www.whatsapp.com/legal/ http://www.whatsapp.com/legal/
• josh2600 13y ago
  For everyone saying this is a waste of money, consider the commentary around Instagram at $1B. Basically the world said that this was a horrible acquisition at the time, but in retrospect, buying Instagram was quite cheap. Buying your closest competitor for less than 15% of your market cap is usually a good idea. Fast forward to today. What'sapp is the dominant messaging application across the world. Carriers hate it but they can't do anything to stop it. Facebook hates it and no matter how much they improve facebook messenger, they keep falling behind. This represents a massive existential threat to Facebook's business: engagement. To kill their closest competitor for, again, less than 15% of the company, is a rational decision. Since Viber and What'sapp have both exited the market, I think it's time for someone to build a new messaging app. There's a lot of room in a once incredibly crowded space.
  • TylerE 13y ago
    I'm not sure that sort of relativism makes sense. Making a really bad purchase doesn't make your earlier merely bad purchases less bad.
    • georgemcbay 13y ago
      Don't worry, when they pay $25B for Snapchat this will also seem cheap!
    • peteforde 13y ago
      You really think Instagram was a bad purchase.
      • TylerE 13y ago
        In so much as none of this handy-wavey social business models have ever proven to have sustainable profitability, yes.
      • flyinglizard 13y ago
        No one can tell, really. Arguably, Instagram was bought for what it could have been, not for what it was.
• MichaelTieso 13y ago
  Personally I prefer Voxer. The requirement of having a phone number on WhatsApp doesn't work for me. I'm constantly traveling and and using different SIM cards in different countries. I'd rather have a single sign-on that doesn't require having to use any phone number.
• ThomPete 13y ago
  I am speechless.... Even if I apply all my knowledge about valuation, product market fit, historical knowledge and add a glass is half full attitude to this acquisition I can't fathom that evaluation. Then I think about instagram selling for "only" 1B and it kind of make sense. Kind of...
  • apa-sl 13y ago
    And after that think about Flickr selling to Yahoo for like $20m?
• deleted 13y ago
  [deleted]
• continuations 13y ago
  How did WhatsApp gain traction? Presumably most of their users already use facebook, which offers the same messaging functionality as WhatsApp. So why do people use WhatsApp instead of Facebook for messaging?
  • greenpresident 13y ago
    It's phone number based, so it's disconnected from your social media presence. You don't have to add anyone or allow them access to whatever you might share with your circle of friends. In my experience it also handles group chats better than Facebook and grew popular before the advent of the Facebook messenger app.
    • pbhjpbhj 13y ago
      >allow them access to whatever you might share with your circle of friends // I only know about it from being recommended it and having read it's legal info today but ... the legal info says that anyone with your phone number listed in their contacts can access your messages unless you block them. That seems different to what you're saying. (Like I said, I've not used it).
  • slig 13y ago
    IIRC, they used to market the app as "free SMS service", which, I believe, was a key component in getting huge amount of users in 3rd countries.
    • ronaldx 13y ago
      > I believe, was a key component in getting huge amount of users in 3rd countries. In the UK as well. Although many people have free effectively-unlimited SMS in the UK, this costs £ and not everyone has. Also consider that international SMS are charged at extortionate rates, and I know some teenagers who have busted through the limit of "unlimited" SMS. And so, the introduction goes: "I'll text you - do you have Whatsapp? Oh :(". This social pressure has driven almost everyone onto the service. And people have kept using it because it's just as functional and less restrictive than 160 characters.
• domydeal 13y ago
  In order to keep up FB's stock valuation the need to show continued growth which slowing at a vary rapid rate. WhatsApp is adding 1 million new users per day. That's what zuck bought. And the ROI? Will be the market applauding FBs growth and driving the stock price to $100.
• techaddict009 13y ago
  Google placed bid of 1 billion $ and mark just multiplied it with 16 ! lol!!
  • pbhjpbhj 13y ago
    Maybe they got an extra 0 (zero) in there by accident?!
• idleworx 13y ago
  One can only wonder how many services or products that provide true value and innovation around the world could have been created with that much money instead...
• kenshiro_o 13y ago
  Can anyone put in numbers what the benefit is for FBK in paying so much for whatsapp? I just don't understand how a messaging company can be "worth" so much, even after extrapolating the expansion in user base. Don't get me wrong - WhatsApp is a great product and very easy to use on top of that (using phone number as id is a great idea to onboard users in a very intuitive way). But I fail to see where this valuation is coming from.
  • wellboy 13y ago
    It's pretty much fear in my opinion. The main platform Facebook is already not cool anymore, so they have to buy cool things to stay cool. Only problem is, if you're not cool and you acquire cool things, these things automatically become not cool. But we'll see.
    • JetSpiegel 13y ago
      That's why they keep them separated. Kids won't read the small print, and if you read the small print then you don't see ads anyway, you're just a cost to them.
  • rgovind 13y ago
    Don't look at it as a messaging company. Look upon it as a communication company. Over the last 20 yrs, any company which has make communication with others easier has profited handsomely....eg Skype, mobile-phone operators.
    • adventured 13y ago
      That's not true. ICQ turned out to be practically worthless. MSN Messenger, AOL Messenger, Yahoo Messenger. Those ended up not generating any meaningful business what-so-ever. How do we know at this point that WhatsApp, Snapchat, et al. aren't going to end up in the same history bin? How about webmail? Is Yahoo's email service worth $20 billion dollars? Is Gmail worth $20 billion? Nope.
      • 13y ago
• batuhanicoz 13y ago
  From the press release[0]: "... and WhatsApp’s core messaging product and Facebook’s existing Messenger app will continue to operate as standalone applications." Why is that, I wonder. I was really excited when I heard the news since WhatsApp is the most used app and Facebook Messenger is the second, they becoming one would have been nice. And chatting my friends on WhatsApp using Facebook Messenger [on the web] would be a killer feature for me, I feel the need for a web interface/desktop app every time I receive a message on WhatsApp and my phone is away. [0] http://newsroom.fb.com/News/805/Facebook-to-Acquire-WhatsApp http://newsroom.fb.com/News/805/Facebook-to-Acquire-WhatsApp
  • yeukhon 13y ago
    Trust me. They will change. A year or two later they will add some integration with FB. I am sure they have a bigger plan for the future (instagram, whatsapp, fb) in one platform.
• matan_a 13y ago
  $3B in RSUs for employees. Assume 50 employees and equal share - that's $60M each. Wow.
• huskyr 13y ago
  Facebook suddenly acquired the world's (if we exclude the US and China) most popular messaging service. I communicate with this app with all my friends, and share stuff that i have no intention of ever putting on Facebook. Everything that once seemed 'private' is now in the hands of a website that forces it users to share as much as possible with marketeers and advertising companies. It's gonna be one tough mission for FB to convince WhatsApp users they're not gonna be playing around with their data. If there's one moment to launch an email-like distributed protocol and app for instant messaging (and somehow convince all my friends to use it), i guess it's now.
  • johngalt 13y ago
    The closest option is XMPP. Unfortunately it's suffered an extreme case of scope creep. http://en.wikipedia.org/wiki/XMPP http://en.wikipedia.org/wiki/XMPP
    • mahyarm 13y ago
      And it's shit for mobile.
      • huskyr 13y ago
        I guess that's why WhatsApp uses it ;)
        • mahyarm 13y ago
          Trust me, they've modified it heavily by now and probably use a bunch of side services that don't use it fully. It's a common pattern in messaging startups. Use XMPP, find out ejabberd is the half-decent one, migrate slowly away from XMPP eventually. Facebook had a similar trajectory.
      • teacup50 13y ago
        It's no more shit for mobile than the HTTP+JSON "protocols" people ship every day.
    • 13y ago
• k-mcgrady 13y ago
  Even though at the time it seemed ridiculous I could understand paying $1bn for Instagram. Photos is Facebook's most used product and Instagram was stealing users photos on mobile. $16bn for WhatsApp I just can't understand. Facebook has a brilliant messaging app. Lots of people use it - even people who use WhatsApp continue to use Facebook Messenger.
  • matznerd 13y ago
    1 million new users a day and most likely in countries where Facebook is not growing as quickly...
    • k-mcgrady 13y ago
      Is that really worth $16 BILLION though? Think of the marketing they could have done to get those users in those countries with 10% of that money.
      • ulfw 13y ago
        Plus it's not like they will 'convert' those non-Facebook users and make them use Facebook suddenly. So then the question comes up on how to monetize this thing to earn back the $19,000,000,000
• sschueller 13y ago
  So, now can we get someone to make an open source, distributed, and NSA secure chat client?
  • patrickk 13y ago
    http://mashable.com/2013/07/10/hemlis/ http://mashable.com/2013/07/10/hemlis/ NSA proof messaging app from the co-founder of the pirate bay. The website says they will open source it, however it only runs on their infrastructure.
    • balladeer 13y ago
      They said they will open source parts of it. And as long as there's not an alternative that you can install it yourself along with their main server installation - like XMPP - the risk will always be there. So, as now Viber seems to be a better alternative than Helmis.
• pisarzp 13y ago
  This is just ridiculous. As per their latest financial statement, $16B is $B more then they have in the bank. Part of that is stock, but still... On top of that, it's 8 times more then their 2013 net income! People say it's defensive play, but to me it looks like overly aggressive play with huge risk and very little potential. Facebook already has huge market share with their messaging platform, and they really don't need this that badly.
  • notahacker 13y ago
    $12bn of it is stock (as is the employee grant) so in fairness they're paying prices inflated by optimism about retaining and monetizing social network users mainly with currency inflated by optimism about retaining and monetizing social network users.
    • atmosx 13y ago
      The entire operation is incredibly inflated on both sides.
• deleted 13y ago
  [deleted]
• samsquire 13y ago
  Does anyone know any alternatives (with group chat)?
  • danabramov 13y ago
    Where I live, a lot of people use Telegram. It has less cluttered interface and is also much faster than WhatsApp on unreliable connections.
  • chris123 13y ago
    Google Hangouts
  • ulfw 13y ago
    Don't they literally all do it? Line, KakaoTalk, WeChat, iMessage, BBM...
  • vassvdm 13y ago
    MySMS is a similar service that also enables to send text messages via a desktop (web) application. I've been using it for a while. It can be a bit buggy though - not as polished as Whatsapp.
• pearjuice 13y ago
  Am I the only one upset with this? I don't use Facebook - haven't and never will - because I hate how I and all my data will become their product on registration. Sure, Whatsapp has its quirks being proprietary and all, but now, I am basically doomed. Whatsapp says they will stick to their core and stay independent, but I have 16 billion reasons to believe otherwise. The sad part is that due to Whatsapp, I can't escape my doom because EVERYONE I contact daily uses Whatsapp. I would basically kill myself socially if I were to delete Whatsapp. I really, really hope Whatsapp stays Whatsapp but knowing Facebook we are fked either way.
  • tool 13y ago
    I'm exactly in the same boat as you and this really stresses me out. With WhatsApp I finally felt like I could stay in touch with people easily and "casually" without being on Facebook, it has became a big part of my daily routines.
  • sasvari 13y ago
    The sad part is that due to Whatsapp, I can't escape my doom because EVERYONE I contact daily uses Whatsapp. I would basically kill myself socially if I were to delete Whatsapp. I have been playing around with deleting my whatsapp account (for different reasons) in the last couple of months, but haven't because of everybody uses whatsapp. But I don't share your sentiment. I just used this acquisition as a trigger to actually delete my whatsapp account. And I don't think I'll miss anything really significant (the SNR went done quite a lot lately anyway): I'm still as reachable as I've been before. Maybe I can manage to bring more of my social contacts to actually use an open XMPP client anyway ...
  • RandallBrown 13y ago
    Just curious. Why couldn't you use text messages to contact the same people?
    • espitia 13y ago
      In my case, for example, most of my friends are not born americans but rather people that lived in south america that moved to the US or still live in south america. In Colombia/Vzla EVERYONE uses whatsapp. At first it was because SMS has charges per text sent so a free, better way to communicate (whatsapp) quickly became the norm. Network effects pushed through boundaries and now I use it more than anything else to communicate with friends and family. I have groups with my immediate family and with friends across borders. Mind you, I've lived in the US most of my life so I use iMessage with all americans and whatsapp with the rest. I think it comes as a surprise to most people in the USA because here we never had to deal with SMS charges (plans were for the most part unlimited). In other parts of the world, the opposite is true, which is where whatsapp gained it foundation. Add to that cross platform, free, awesome ux, network effects and the fact that IT WORKS PERFECTLY and boom, 19B. Cheers.
• adventured 13y ago
  This acquisition is not YouTube or Instagram. This is a peak of the bubble purchase, that will be massively marked down for accounting purposes a few years from now. Smart to buy them? Sure. For $19 billion? Nope.
• hasenj 13y ago
  Am I the only one who thinks this is beyond crazy? Youtube was acquired for less than $2B (and not even in cash!)
• cangencer 13y ago
  Interesting to see that they use Erlang. http://www.erlang-factory.com/conference/SFBay2012/speakers/RickReed http://www.erlang-factory.com/conference/SFBay2012/speakers/... I wonder if this is still valid?
  • emaste 13y ago
    Yes, here's a quote from the FreeBSD Foundation's July 2013 newsletter: At WhatsApp we leverage FreeBSD and Erlang to provide industry record uptime. The ability to scale linearly on commodity hardware has allowed WhatsApp to keep our serving costs low. These days we run anywhere between 2 million and 3 million concurrent TCP connections on a single FreeBSD server... https://www.freebsdfoundation.org/press/2013Jul-newsletter#whatsapp https://www.freebsdfoundation.org/press/2013Jul-newsletter#w...
    • tostitos1979 13y ago
      Wow! 2-3 million concurrent TCP connections? I just discovered C10K last year :( Is this a fundamental difference between thread based networking and evented network IO? What am I missing?
      • strmpnk 13y ago
        Not exactly. While there are ways to conflate a connection with a thread, these are not always fixed pairs. Generally, it depends on the kind of connection activity and a bit on which operating system. Event based IO is simply pushing information that kernel schedulers already use into user space. The trade-offs really depend on where you need control the most. Many kernels can do a pretty good job at general purpose networking but at this scale you tend to care about the details and so more of these systems tend to push the decision making to the program using APIs like epoll & kqueue (Linux and *BSD respectively). Keeping this information transfer cheap for millions of sockets is not as trivial as just using the API but it's a necessary step to control overhead. Whether your user space code uses threads in places to get work done is often misunderstood as well since thread doesn't always mean a single logical thread in a program. Erlang, in SMP mode, uses threads to run it's own process schedulers (much like an operating system). The operation of these schedulers is handled in such a way that IO can efficiently block a process and the scheduler can move onto other things in queue. So, in many ways, it's the same ideas we had on the bare OS but with more specific implementation governed by Erlang's philosophy.
• shmerl 13y ago
  I hope they'll convert this abomination into a proper XMPP service. On the other hand Facebook doesn't federate with others anyway, so it's one selfish beast buying another.
• staunch 13y ago
  Damn, Zuck is far more paranoid than I thought. He's going to have to come up with a better strategy than buying every company that presents a potential existential threat though. Especially at these prices! I actually think it wasn't such a bad idea to buy Instagram. He paid 1% for something that really could have killed him. But paying $16 billion here is pretty much surrender as far as I'm concerned.
  • 001sky 13y ago
    Even if its a rope-a-dope its potentially a smart move. He needs to roll-with-the punches and keep in the lead. Once evaporative cooling kicks in, its not going to be a good ride. So its really best to do whatever is possible to stay ahead...even if that means being the borg of social networking. He has enough of a lead and can accept enough dilution that it remains worth it to continue to layer the next generation of services. A touch passive agressive perhaps, but its perhaps agressive enough to keep the party going another year or two. Which is the time he needs to plot the next move...I mean its unlikely he's going to invent the next FB ;D.
    • andrewfelix 13y ago
      Starting to sound like Microsoft post Windows.
    • djs123sdj 13y ago
      holy metaphors!
  • adventured 13y ago
    Zuck should probably be fired (gracefully step-aside, courtesy of shareholder activist pressure, given his voting control) when Facebook is forced to do a $16 billion write-down on this. WhatsApp won't even be worth the cash they're paying for it when the music stops. They just bought today's version of ICQ for $19 billion. This acquisition leads me to believe Facebook is most similar to Yahoo at the peak of the dotcom bubble (the acquisition strategy, the massive overvaluation, the weak advertising platform). Yahoo was a portal, Facebook is the same premise but in social networking (the all-in-one champ). There will probably be pieces that spin out of the social networking scene that end up producing the next Google, while FB languishes as the new Yahoo.
• fidotron 13y ago
  The question here is where do FB see the value? Is it a pure defensive play about messaging or are they after the social graph you could extract (along with a lot of other juicy data) from the WhatsApp DB?
• KevinAtHome 13y ago
  Strange no one is mentioning threema, getting popular in germany.
• pdknsk 13y ago
  It's madness. Are the people involved aware that 16B is a number with 11 digits? It's a serious question.
• dhoulb 13y ago
  I just can't get my head around that valuation. For something that's basically a feature, when they already have that functionality baked in, built out to a similar scale? It's not an acquisition for talent, or technology, so what is it? It's an acquisition for investors probably. To argue back against the people who say the kids are leaving FB. Well guess what, we BOUGHT the thing the kids are using. And it's 'mobile first'. They can probably continue to buy the 'cool app of the week' for the rest of their existence. Probably not at THIS scale, but certainly the $1-2b range. The rest of their user base is pretty solid. As long as they can show their advertisers that they're appealing to young people too, it's probably a strong plan. They just really screwed up on messaging, and let these guys grow too big before deciding or being in a position to buy them. Doubt they'll let it happen again! They'll have their eyes open and will snap up ANY new apps that show strong user growth in younger markets. Tech people have a major bee in their bonnet about Facebook. We kinda assume the kids are flocking away for the same reason we are: privacy. But it's not. Kids just get bored easily so they like to try new things. Young people aren't 'leaving' Facebook, they're just using other stuff alongside it. Facebook just has to provide one or two interesting buzzy distraction apps to last until the kids turn into adults, get jobs, and use Facebook exclusively again because it's where everyone is, and they don't have time for 15 separate apps any more.
  • KaoruAoiShiho 13y ago
    This is your heads up to stop thinking in terms of features. Value != technology.
  • erikpukinskis 13y ago
    They acquired the attention. WhatsApp created the expectation in a half billion people that they will help them exchange messages with friends and coworkers. That expectation is what is being valued. If Facebook could steal just that expectation and change it from 'WhatsApp' to 'Facebook Messenger' in peoples' heads then WhatsApp would be worth $0 to them.
  • nly 13y ago
    > It's not an acquisition for talent, or technology, so what is it? http://i.imgur.com/yzo9kc1.jpg http://i.imgur.com/yzo9kc1.jpg
• Nux 13y ago
  http://www.whatsapp.com/faq/android/21119703 http://www.whatsapp.com/faq/android/21119703
• dba7dba 13y ago
  Found tumblr posts from sequoia on why Whatapp is great. http://sequoiacapital.tumblr.com/post/77211282835/four-numbers-that-explain-why-facebook-acquired http://sequoiacapital.tumblr.com/post/77211282835/four-numbe... This is confusing for me though. 1. WhatsApp prides on: No ads No games No gimmicks And WhatsApp doesn't collect personal data. Facebook is OPPOSITE of those attributes of WhatsApp.
• wslh 13y ago
  How this negotiation evolves until the point of reaching this sum? Is it like bargaining in the suoq (http://en.wikipedia.org/wiki/Souq http://en.wikipedia.org/wiki/Souq) ?
• yawz 13y ago
  $40/user - $345m/employee Truly amazing! If you remember the days when JBoss was acquired by Red Hat, this is the same "value" as one JBoss per Whatsapp employee. Incredible!
  • dba7dba 13y ago
    haha, and where is JBoss now and what has it done for Red Hat?
• kayoone 13y ago
  they dont buy the users or the app or the team. What they buy is massive mobile usage. Lately i always thought that Whatsapp was becoming the next facebook as event planning, foto sharing and of course messaging transitioned from fb to whatsapp. Looks like fb thinks the same, they feared whatsapp.
• steven2012 13y ago
  In one fell swoop, Snapchat went from fools to geniuses. Unbelievable.
  • omarchowdhury 13y ago
    No they are still fools because, other than Facebook, who else is going to pay them $3 billion?
• adamio 13y ago
  Spend $19billion here in the hopes of segmenting the market with more startups hoping to cash in?
• pbreit 13y ago
  I usually don't poo-poo acquisitions but this one surprises me for a) the valuation (Facebook really couldn't convince them to exit for 5 or 10 billion?) and b) Facebook really needs to demonstrate that it can get into these markets itself. With all the supposed ingenuity, developer talent, money and existing users, why can't Facebook build anything besides a news feed?
  • mcintyre1994 13y ago
    I personally think Facebook Messenger is better than Whatsapp, and you can easily upgrade to a private group when appropriate. Whatsapp seemed to miss the ball on tablets/everywhere by focusing only on phones and requiring a phone number, which obviously worked for them but I think Facebook's product is better.
• andrewfelix 13y ago
  Serious question: What is so compelling about whatsapp? There are so many IM protocols out there.
  • MichaelGG 13y ago
    From what I can tell: You just lay it on your phone and it "just works". That is, you use phone numbers and it sorta places SMS. No accounts to create or sign into, no contacts to add, etc.
• te0006 13y ago
  This is just sick. Does at least some tax apply to such transactions in the US? Or think what the Gates Founation woul dbe able to do with just, say, a quarter of this money.
  • MichaelGG 13y ago
    From reading Gates' annual letter, it doesn't sound like a whole lot would change with that bit of extra money. The things they want to do, like vaccinate multiple continents, take orders of magnitude more money than they have. Not saying it wouldn't be good or nice, but I don't think we'd see a noticeable difference. After all, they could always step up their spending from, what, $4BN a year?
• paulrademacher 13y ago
  I think I will nominate myself to be the single person on Hacker News, who after an announcement of a huge mega-acquisition, will skip all the high-minded analysis and discussion of business models and ROI, and simply say: Wow, I wish I had a $19B acquisition -- I'm jealous :-)
  • MatthiasP 13y ago
    I would already be satisfied with a $19M acquisition.
    • AznHisoka 13y ago
      Hell, I'd take a 1.9M acquihire, with 10 year golden handcuffs :P
• deleted 13y ago
  [deleted]
• pyrrhotech 13y ago
  crazy to think WhatsApp is worth almost as much as Netflix or Tsla. I think they overpaid. Will short the stock at open tomorrow. I was long $25 to $55, but this kind of recklessness with a young management team is destroying shareholder value.
• adamt 13y ago
  This is Sequoia's blog post. It was enough to make me slightly overcome my complete shock at the valuation ... http://sequoiacapital.tumblr.com/post/77211282835/four-numbers-that-explain-why-facebook-acquired http://sequoiacapital.tumblr.com/post/77211282835/four-numbe...
• 31reasons 13y ago
  New business model: Become a thread to Facebook.
• rottyguy 13y ago
  A few thoughts.. I'm sure like many, I'm blown away at that price tag consider Motorola went for 12B and the recent TWC/Comcast is valued at 45B with both having hard assets. But after some reflections, I can see some positives that grounds my disbeliefs a bit. 1) As someone has already calculated $40/user is really not that bad (though how many overlap with fb already?) 2) You have trusted groups with WA, something you don't really have with FB (facilities are there but I doubt many use it). 3) With trusted groups, you tend to be a bit more open about your dialog so fb could gleen yet more, arguably better, information about you. The other question in my mind are what other features are of value to WA? Video (facetime-esq) seems like a no brainer...
• wllchng 13y ago
  This is definitely a defensive move against Tencent, who is using Wechat as their weapon for global penetration. Tencent must be seen as a threat, given their ability to monetize their userbase drastically better than Facebook or Twitter. There are rumors that Tencent is also a covert investor in Snapchat as well. GGV Partner and China VC Hans Tung makes the argument that Tencent's market cap will overtake Facebook's in 3-5 years. http://www.bloomberg.com/video/could-chinese-competition-beat-out-facebook-VFrr1lqDQqSfZeo27dvnvw.html http://www.bloomberg.com/video/could-chinese-competition-bea...
• KaoruAoiShiho 13y ago
  This is a much better buy than snapchat I think. But why is FB once again the only one taking social seriously? Hello Google what are you doing...
  • psbp 13y ago
    Social isn't serious. It really shouldn't be.
    • KaoruAoiShiho 13y ago
      Obviously the best way to communicate is via carrier pigeons.
      • psbp 13y ago
        I'm saying this isn't needed and serious innovation. It's a popularity and standards game. We definitely didn't use carrier pigeons before Whatsapp. IM clients have been ubiquitous for years.
        • KaoruAoiShiho 13y ago
          On desktop, not on mobile. This is the first big mobile IM service and the network effects are tremendous. Every other IM service is crappy (Skype) or late (Voxer) or crappy and late (Hangouts).
  • thehellboy 13y ago
    was surprised too to see that google didnt make an offer ,
• deleted 13y ago
  [deleted]
• locusm 13y ago
  They recently did 54B messages in a 24 hr period https://twitter.com/WhatsApp/status/420373902980689920 https://twitter.com/WhatsApp/status/420373902980689920
• booruguru 13y ago
  Facebook is barely 10 years old and they're already the new Microsoft...maintaining dominance by acquiring every major competitor that poses a threat. And I'm not necessarily saying that's a bad thing.
• ulfw 13y ago
  $19,000,000,000. Just making clear. 19 Thousand Million Dollars. 19 Billion. For a mobile app.
  • pyrrhotech 13y ago
    over 10% of FB total inflated market cap. short with me! When this thing implodes, it's going back to the teens ironically
• jackgavigan 13y ago
  Social networking is all about network effects. The biggest threat to Facebook's position at the top of the pile is that another social network will come along, start to gain traction (most likely initially with users that aren't current Facebook users - e.g. early teens) until it reaches a tipping point where current Facebook users start migrating to the new social network because that's where the people they want to interact with are hanging out. Once that tipping point is reached, the migration is likely to happen rapidly and irreversibly. By acquiring companies like Instagram and Whatsapp, Facebook is not only preventing them from usurping its social networking crown but bolstering its own position against future emerging competitors. $19bn might sound like a lot but it's cheap when you consider that the risk of not buying Whatsapp is that it eventually obliterates Facebook in the same way that Facebook obliterated Myspace and the original Bebo.
  • chiari-show 13y ago
    so you think that the goal was to not have any competitors in the smartphone messaging? because Instagram and Whatsapp are not Social Networks.
• prosperva 13y ago
  This was sorely done to retain users but I predict users are going to leave both services and join Viber. Will Facebook also buy Viber?
• blazespin 13y ago
  The simple issue is that Facebook is the one that is overvalued, not WhatsApp. I'm sure it was mostly paid for in stock. If you don't think Facebook is overvalued, that's fine, but you can't complain about WhatsApp then. Also, I doubt this reduced Mark's control of Facebook. Just his common share equity. He still has the special class of voting shares that I'm sure all he really cares about.
• jimzvz 13y ago
  Now facebook will access to my contact list :( It is really difficult to remove Whatsapp as it the primary communication tool for most of my network. Really sad news.
• TomGullen 13y ago
  If I was a FB holder think I'd rather take a 10% dividend: $19000000000 (purchase price)/2547000000 (number of shares) = ~$7.50 per share
• curiousDog 13y ago
  In comparison, the Airbus A380 cost $11bn to develop. Is this really wise capital allocation by the street? Imagine what valuable technology could be built with this money. I for one, sold my stock in facebook just now.
  • adventured 13y ago
    No it's not wise (regarding the cash), but then a large portion of the value isn't real and will never be real; it's bid-up paper trading at 100 times earnings. Swapping one piece of overvalued paper for another, is most of the deal (I'd take the FB paper personally, it at least has some earnings behind it). And keep in mind, this isn't capital allocation by the street, it's capital allocation by Zuckerberg, he controls Facebook. This crashes and burns, it's solely on his head.
• RandallBrown 13y ago
  What does WhatsApp offer that regular old text messages don't? Is it just a price thing? I can group chat, send images, and send video with everyone, even people with dumbphones just fine using text messages (MMS).
  • Rizz 13y ago
    Price. I only just got my first contract with unlimited sms, before that it was € 0,09 (12¢) after using the few hundred that come with your plan. MMS is not included in plans and still is € 0,50 (69¢). So everything that's an image or goes to a group goes on whatsapp.
  • chockablock 13y ago
    How much do you pay for international SMS/MMS?
  • statictype 13y ago
    MMS works very unreliably. At least for me and every single other person I know who has tried it. Heck, even SMS can sometimes be unreliable, especially on international roaming.
• mudil 13y ago
  Disney is valued at $103B. That includes ESPN, parks, cruises, Star wars, movies, merchandise, etc etc etc. So how's What's app is 1/5th of it?
  • adventured 13y ago
    Alcoa is worth $12 billion. Deere is worth $31 billion (2.4% dividend, $37b sales, $3.5b profit). Caterpillar is worth $61 billion (WhatsApp is worth 1/3 CAT? lol). Or there's Sony, $17b market cap, $72b in sales. The truth is WhatsApp is only worth ~11% of Facebook, it's not actually worth $19 billion free-standing, because Facebook's value is mostly in paper that could never be sold for what it's trading at. Nobody is going to step in and pay $19 billion in cash for WhatsApp, and you won't catch an industrial titan like Exxon or Ford swapping its shares for nearly worthless instant-messenger users. Google also wouldn't be so stupid as to do that in my opinion.
• mudil 13y ago
  Disney is valued at $103B. That includes ESPN, parks, cruises, Star wars, movies, merchandise, etc etc etc. So how's What's app is 1/5th of it?
• adventured 13y ago
  Anyone else think the "users" obsession smells an awful lot like the "eyeballs" obsession? Oh but these companies have revenue? WhatsApp and Snapchat have no meaningful revenue in comparison to their valuations. And the companies with revenue, are being valued at insane multiples (infinity for Twitter, 85 to 100 times for Facebook, 800 or so times for LinkedIn).
• ulfw 13y ago
  Blackberry should have sold BBM to Facebook and shut it's doors. Their whole market cap is about a quarter of that.
• zt 13y ago
  Of all the companies founded since 2000, these are the following companies that are worth more than $10B: Facebook, LinkedIn, Twitter, WorkDay, and ... WhatsApp.
  • statictype 13y ago
    For what it's worth, I've never heard of WorkDay. I created a LinkedIn account and since then my only interaction with is archiving their spam mails. I use WhatsApp more than I use Facebook or Twitter (and this is true of a lot of people outside U.S). In general, it may not be as active as Facebook or Twitter but its pretty damn high. Also - no ads or privacy issues or BS marketing.
• goatslacker 13y ago
  Just to put numbers into perspective: NASA's 2014 budget is 17.7b
• pinkskip 13y ago
  OMG. Next step Facebook messenger and whatsapp are merged?
• argumentum 13y ago
  To everyone calling this symptomatic of a "bubble", remember that WhatsApp was not hyped like SnapChat or Instagram. It wasn't associated with "sexting" or plugged by Celebrities. A few years ago, my cousin arrived from India to start undergrad here .. when picking out her new smartphone, here was only one requirement: it had to run WhatsApp. She didn't care whether it was an iPhone, android or blackberry (back when bb's were a thing). She didn't care about the camera or processor speed. Her decision was based on a measly little app that I'd never heard of. WhatsApp just made something people wanted, badly. It's even profitable, for crying out loud. Whether this is a good decision and price for Facebook is to be determined. Many thought Google overpaid for Youtube and FB overpaid for Instagram, and look how those turned out. In addition Zuckerberg likely thought that much like losing image sharing, losing messaging would pose an existential threat to Facebook. Zuck's strategic track record has been stellar, all the way back to the beginnings of Facebook. The one "mistake" he admitted to (HTML5 vs native) was corrected promptly and thoroughly. I'm willing to bet he's got a much better handle on these things than given credit for. I'm long on FB and buying on any dips.
  • cylinder 13y ago
    None of the things you mention matter, frankly. Nobody is claiming whatsapp is worthless. It's the valuation. Just because your users are passionate doesn't mean you deserve a high valuation. And something missed here is that Indian, SE Asian users, et al aren't that valuable in terms of how much money you can make displaying mobile ads to them.
    • argumentum 13y ago
      > Just because your users are passionate doesn't mean you deserve a high valuation No one "deserves" any particular valuation: those numbers come from how much people are willing to pay, and how little you're willing to sell. Due to the post acquisition success of Instagram, companies like SnapChat and WhatsApp have more leverage than their predecessors in these negotiations. Thus, they command higher valuations. WhatsApp, though of course a Valley company, seemed to have been "discovered" overseas. It famously doesn't have ads and instead charges $1/year (which its users are willing to pay). In the short term, yes, India/SE Asia are less lucrative markets per person, but in the long term they have greater potential for growth. With the numbers as they are, looks like Zuckerberg intends this as a long term play.
• kolev 13y ago
  Desperation shadows reason. I personally think Kik was a better buy.
• simplekoala 13y ago
  It looks like Brian Acton, Whatsapp's founder was turned down by Facebook in 2009. What a comeback! This must be even sweeter! https://twitter.com/brianacton/status/3109544383 https://twitter.com/brianacton/status/3109544383
• happyscrappy 13y ago
  Maybe part of it is for the data on WhatsApp users. * "In the event that WhatsApp is acquired by or merged with a third party entity, we reserve the right to transfer or assign the information we have collected from our users as part of such merger, acquisition, sale, or other change of control." [they go on to say that they may not be able to control use of information in cases which include "reorganization"] http://www.whatsapp.com/legal/ http://www.whatsapp.com/legal/ Still seems ridiculously expensive.
• vmavalankar 13y ago
  Here's Why .. http://vmavalankar.svbtle.com/why-facebook-bought-whatsapp http://vmavalankar.svbtle.com/why-facebook-bought-whatsapp
• vmavalankar 13y ago
  Here's why .. http://vmavalankar.svbtle.com/why-facebook-bought-whatsapp http://vmavalankar.svbtle.com/why-facebook-bought-whatsapp
• hoi 13y ago
  Makes perfect sense if you put it into the context of what is happening to other messaging apps. Wrote this a few days ago before Viber and now this acquisition. http://www.hoista.net/post/76404923258/the-rise-of-trojan-horse-platforms-kakaotalk-wechat http://www.hoista.net/post/76404923258/the-rise-of-trojan-ho...
• mmcclellan 13y ago
  For perspective, this is about Sony's market cap. LinkedIn's market cap is ~$24B and Twitter ~$30B.
• mrwnmonm 13y ago
  why should we care about this more than other things in our lifes?
  • fletchowns 13y ago
    Who said you should? Why would you even leave a comment like this?
• shortsightedsid 13y ago
  This highlights another of Yahoo's screwups, IMHO. Whatsapp is built by 2 ex-Yahoo employees. Guess what everyone used in the late 90's for messaging? Yahoo Messenger. That's right - I used Y! Messenger all the time to keep in touch with friends before Social Networking was the norm and I'm pretty sure everyone else did too. There is one more company that had the lead in messaging and screwed up - Blackberry. They released their app across platforms, 5 years too late. Had they hit the iPhone/Android apps stores 5 years back, they would have been in a better place than Whatsapp. The funny thing is that their co-founder even wanted to do that and not go after BB10 but he got pushed out. I remember reading that whatsapp's servers basically run using Erlang. Erlang scales massively, and is a beautiful language for messages/telecom etc.. Hopefully, this will trigger some more interest in Erlang.
• deleted 13y ago
  [deleted]
• awkwit 13y ago
  It'll be interesting to see if we still have as many Whatsapp-type apps in future. It seems like there's already quite a few... WhatsApp... WeChat... Line... Kakaotalk...Viber...
• vdhus 13y ago
  does this mean Viber should feel ripped off at $900m?
• tulga 13y ago
  Facebook going to mobile operator business. They have very good relationship with Microsoft. Microsoft has mobile platform and Nokia and Skype. I think FB + MS will create something to change whole telecommunication platform. Many mobile operator companies afraid that.
• ksoti 13y ago
  Stupid question but will "existing" whatsapp users have to use their/create a new facebook account to use whatsapp starting in a few months?
• notlisted 13y ago
  I know What's Up. Facebook just bought the world's largest (and unlisted) mobile phone number directory: WhatsApp's convenient 'matching by phone number' feature uploads of all of your phone contacts to their servers. Though positioned as one of the good guys, they too had their price. With this acquisition, FB bought the ultimate data set of users and leads, and with it secured access to the last remnants of your privacy. Your fake name/profile on FB will no longer protect you. Your friend's contact list spilled the beans months ago... Uninstalling WhatsApp now, though I realize that after several lovely years might just be too late already. Cat, bag, out of. Such wow. Much sad.
  • lucb1e 13y ago
    Exactly my thoughts. Any idea how to get out of Facebook's database? I'd be willing to pay but then they have my full name instead of just a fake and my phone number.
    • junto 13y ago
      I'm in the same position. I deleted my Facebook account last year and now it feels like they have rejoined me without asking me. Damn it.
    • notlisted 13y ago
      No clue. I'm actually inclined to start a petition to stop this deal. Too much information in the hands of one company if you ask me. Note: as a self-described Google fanboy, I do realize that Google has all this and more of me as well, but at least they provide many useful services, haven't changed the privacy rules on me, allow data export, and keep the data to themselves.
  • jhonkola 13y ago
    This was also my first thought. FB gets a lot of information on people's actual behavior wrt their contacts (who do you contact and how often), and this for people all over the world.
• AznHisoka 13y ago
  Can someone enlighten me why WhatsApp is popular, and <INSERT ANY MOBILE CHAT/IM APP> is not? Why not Google Talk? Why not AIM?
• dredmorbius 13y ago
  Interesting to note that WhatsApp had started circulating some overly broad and ill-formed "DMCA takedown" notices a few days back: https://github.com/github/dmca/blob/master/2014-02-12-WhatsApp.md https://github.com/github/dmca/blob/master/2014-02-12-WhatsA... By this email, please accept this formal notice and takedown request for the following content on the GitHub site. I am starting with these requests to ensure you will take action on our request. We will have follow-on requests, as the list of infringing content below is not exhaustive. Specifically: The following URLs use of the WhatsApp name and logo, use of other WhatsApp content, unauthorized use of WhatsApp APIs, software, and/or services, and provision of software and services related to WhatsApp infringes on WhatsApp's copyrights and trademarks, including those related to WhatsApp's name and logo. WhatsApp's trademarks are registered in the United States and countries throughout the world. Note that: • Trademarks aren't subject to the DMCA. • APIs aren't copyrightable. • TOU violations aren't subject to the DMCA. Given that the letter isn't clearly formatted as a DMCA takedown (though it uses some sample language) the effect is ... curious.
• bagels 13y ago
  I read all the comments, the whole time thinking about how crazy this number is. I read why people use it, because it is cheaper (free?) than the ridiculous pricing of SMS. So, I looked up the revenues generated by SMS, and it is estimated to be, according to a very cursory search: 150 Billion USD per year This is the number that Facebook is using to compare their offer against. It is not crazy if they can capture even a few percent of that money.
  • rokhayakebe 13y ago
    Most useful comment in this thread and everything else I've read on Pando, Forbes, Techcrunch, and every where else on the topic.
• tuxguy 13y ago
  http://www.quora.com/WhatsApp-Messenger/How-did-WhatsApp-grow-so-big http://www.quora.com/WhatsApp-Messenger/How-did-WhatsApp-gro...
• throwaway5752 13y ago
  Are you fucking kidding me?
• reubenswartz 13y ago
  Like many people, I found the price staggering. However, given that WhatsApp is growing and may pass FB in active users in the next 2-3 years AND WA has a great monetization strategy... It's not crazy to think that in a few years 1B people would be paying $1 per year. Want to double revenues? How 'bout $2/year. $5? $20 in US and other first world markets, $2 in developing countries? Why not? In addition to the defensive move, this is about disrupting a multi hundred billion dollar wireless industry. I wouldn't have had the guts to do it, but I don't think Zuck is stupid.
  • keeptrying 13y ago
    $50 bucks for life plan ... :)
• billyjobob 13y ago
  Maybe I'm not down with the kids, but I'm not understanding what any of these message apps offer over plain old fashioned email. It alerts me on my phone, it works on my computer, it sends to groups, everyone already has it, it sends photos, it stores a history of all my past communications in one place accessible from anywhere. It's not completely secure but at least you don't have to trust any foreign corporation (Facebook, WhatsApp, etc) with your private messages and can run your own server if you like. Also what if Facebook lock your account because they don't like your name, or WhatsApp go bust and shut down in a few years time? Then you've lost everything, because it was locked into their proprietary little system. I don't understand how anyone would chose one of these as their primary method of communication. Especially as they are all newcomers, and email was well established as what the world used to communicate before they arrived. No-one buys a phone and then decides 'Hmm shall I install email or WhatsApp'; no, you buy a phone, you set-up the email account that you've already had for 20 years, and then after that you maybe decide to install another app. This app offers nothing over email, yet you and all your friends abandon email and use the new app instead? That is some powerful marketing they must have done.
  • mynameishere 13y ago
    Texting is a replacement for short phone conversations. Email was (and still is) a replacement for memorandums. Nobody ever cared if their phone conversations were persistent, and so texts are actually an upgrade from that.
  • te0x 13y ago
    They did no marketing. $0
  • pjc50 13y ago
    Email isn't "instant", and you either have to go with a large provider or fight the spam hydra yourself. I used to run my own mail server and stopped because it was just not worth it. Whatsapp acquired a whole number of users who didn't have computers, didn't have email addresses, and wanted the simplest possible setup that worked.
• kdot 13y ago
  Facebook just purchased 400,000,000 phone numbers.
  • shortsightedsid 13y ago
    450,000,000 actually. At the rate whatsapp is growing, they will add 1 million more phone numbers by tomorrow evening.
  • ozim 13y ago
    Exactly my thought at first, they are asking for it all the time, but I'm not giving it. Now I uninstalled whatsapp from phone because I don't want facebook having my number.
• dannyrosen 13y ago
  It's about the user's contact graphs and making the connections stronger. They're buying user's phone books.
• 3apo 13y ago
  Relevant: Why we don't sell ads : Whatsapp (2012) http://blog.whatsapp.com/index.php/2012/06/why-we-dont-sell-ads/ http://blog.whatsapp.com/index.php/2012/06/why-we-dont-sell-...
• hrish2006 13y ago
  This sucks.
• jebblue 13y ago
  What is WhatsApp? I saw the name somewhere before, maybe on HN, but who are they that they can command a price in the billions? Isn't it a messaging app? Why isn't Pidgin worth $16 Billion?
• notastartup 13y ago
  I think this one will be the turning point for Facebook, remember that M & A in the corporate world have history of senseless and expensive moves that end up bankrupting the company who buy it, $40 per user is an extremely risky bet when Facebook themselves can't even monetize it's own userbase. This appears to be a road to become as big as possible so that you can't possibly appear to fail when faced with companies like Microsoft, Google, Yahoo who are after profitability aligned with their own products.
• vmavalankar 13y ago
  You know we all know and feel the same: http://vmavalankar.svbtle.com/why-facebook-bought-whatsapp http://vmavalankar.svbtle.com/why-facebook-bought-whatsapp
• sirji 13y ago
  Whatsapp was popular just because of its simplicity. Are this people going to screw whatsapp? Hope they don't
• sirji 13y ago
  Whatsapp was popular just because of its simplicity. Are this people going to screw whatsapp? Hope they don't
• superuser2 13y ago
  A lot of people on HN talk about how Facebook is pointless and on its way out. And it's true, Facebook probably doesn't make a lot of sense to people who are steeped in an email culture. Young adults are not. Facebook is far and away the dominant messaging platform. Email in high school was for spam, communicating with teachers, and passing attachments ONLY. Short, synchorous messages that you didn't mind typing with your thumbs would go via SMS, but more verbose synchronous conversations and email-like async conversations were invariably Facebook Messenger. I can find anyone from my real life that I'm likely to want to talk to on Facebook just by knowing their real name and identifying their face in search results. It's entirely frictionless - no exchanging identifiers or mucking around with pseudonyms. And I can have a conversation synchronously or asynchronously, transitioning seamlessly between devices and modes of communication, with conversation history, read receipts, and delivery confirmation always available. Messaging is a more important part of Facebook than I think much of HN realizes. It makes sense that Facebook would neutralize WhatsApp's threat to its hold on messaging.
  • _delirium 13y ago
    Among my circle of friends, that used to be the case, but it's increasingly rare that I find anyone actually signed in to FB chat, so now it's only usable for asynchronous messaging. A bunch of people seem to have moved to either Skype, Hangouts, or iMessage for synchronous chat. I don't have any great insight into which demographics that might be happening in, though.
  • Dirlewanger 13y ago
    >Messaging is a more important part of Facebook than I think much of HN realizes. Yeah, looking at this site's user base, a bunch of late 20s-30s tech people, they may be the place to see what some of the next big things may be, but they are not always the place to look for what is the thing right now.
• x0054 13y ago
  Could someone explain to me why WhatsApp is more popular then say Skype or any of the numerous competitors. I looked at it for the first time today. I find the design of the app to be a bit poor, at least on iOS6. Overall it's a good app that functions well, from what I can see. But so does Skype, for instance. Also, the lack of a PC/MAC client is kind of a letdown. I know it's silly to argue with facts, clearly people really like this app. But could someone explain to me why? I mean, how is it better than Fring, or Skype, or Viber? Or is it just luck? I am curious because if they did something right, I would love know what it was, so I can do it too :)
  • nodata 13y ago
    Don't compare to skype, compare to sms/mms. WhatsApp is free (pretty much), and you can send _photos_ easily and quickly.
  • x0054 13y ago
    I think HN #2[0] article at the moment just answered my question. J2ME is the key, I can see that. [0] http://blog.textit.in/your-path-to-a-$16b-exit-build-a-j2me-app http://blog.textit.in/your-path-to-a-$16b-exit-build-a-j2me-...
  • zyx321 13y ago
    In a word: Convenience. WhatsApp has a total overhead of about one minute per year. Registration requires you to enter your phone number. Once. Afterwards you don't have to worry about anything ever again. Maintaining your contact list is a sunk cost, since it runs off phone numbers. It just works.
• deleted 13y ago
  [deleted]
• dodyg 13y ago
  The biggest question is off course when they will finally migrate from their Erlang backend to JavaScript.
• koevet 13y ago
  The WhatsApp platform is based on Erlang. I really hope that putting the application under the spotlight will also benefit Erlang and its adoption.
• bobowzki 13y ago
  Congrats to the whatsapp people!!
• Kiro 13y ago
  http://tctechcrunch2011.files.wordpress.com/2014/02/messaging-international.jpg http://tctechcrunch2011.files.wordpress.com/2014/02/messagin... Understandable.
• shin_lao 13y ago
  Mark Zuckerberg is most certainly very intelligent and I'm pretty certain his board is highly capable. If they are ready to pay $ 16B for WhatsApp it means that it's worth, for them, $ 16B. For me the take away is that Facebook struggles to grow in "underdeveloped" countries and will pay whatever it takes to make sure these zones are easy to conquer. Those markets are the growth of tomorrow and Facebook is certainly plateauing at home. In the long run, I think Facebook will become some sort of shell company for "anything social".
• antirez 13y ago
  If you have teenager offsprings like me (I've a 13 years old son) you can understand that better maybe. I heard the sentence "We don't need Facebook since there is Whatsapp" an endless number of times from him and his friends. From my point of view at first this didn't made a lot of sense, I considered Whatsapp a no-cost SMS replacement. The reality is that Groups are a killer feature: my son's school class has a group where they share what are the homework for tomorrow, or just send messages that are much alike what you would write on Facebook as status messages. Then I realized that I also created a group for my friends, like, in one group there is me, my wife, and one couple of friends of us where we plan what to do together. In another group there is our family where we share pictures of my daughter. We are using Whatsapp like Facebook as well... Under this point of view this move makes a lot more sense, I believe Whatsapp is eating Facebook traffic.
  • alexdown 13y ago
    tencent's wechat is being used pretty much in the same way. they also have a "photo sharing" feature (wechat "moments") which approximates very well the action of "putting a pic on my fb status for everyone out there to see".
  • fastest963 13y ago
    Are the groups better than what you'd be able make/do on Google Hangouts?
    • antirez 13y ago
      "better" is programmer point of view. From the point of view of users, Whatsapp is simple, does not require an account, and just works. So people use it a lot regardless of the existence of Hangouts and what they can do :-)
    • fab13n 13y ago
      A network's value is correlated to the number of (potential) friends reachable through it, and how easily you can. There are many almost-non-technical reasons why Hangout isn't an adequate replacement for Whatsapp: - not intuitive enough to create and keep hangout groups. I can probably use G+ circles, but that's cumbersome. - I believe that you need a GMail account. There are people without a GMail account I want to reach in group chats, and expecting them to create a new mail account for that feels like too much asking. - the big amorphous G+ blob is so shapeless that we can't think of it It's _possible_ to use Hangouts, possibly with other bits of G+, as a Whatsapp replacement, but it's not easier nor more obvious. Google didn't envision it that way, they wanted you to produce more durable (and searchable) stuff as G+ posts, and to manage access through a circle system that appeals the 5% of the population with an engineering degree. They don't care about technologically-illiterate people, nor those without a GMail account, let alone without a smartphone. But we shouldn't care about why G+ isn't an adequate Whatsapp killer, as Google didn't buy them. What's interesting is, why FB couldn't build it?
• yoodenvranx 13y ago
  Can somebody explain me who gets this money and how it is distributed to the owners?
  • vassvdm 13y ago
    One of the co-founders, Jan Koum, had 45% of the company at the time of the purchase, which makes him worth about 6.8 billion.
• robot 13y ago
  Erlang anyone? http://shop.oreilly.com/product/0636920021452.do http://shop.oreilly.com/product/0636920021452.do
  • gulbrandr 13y ago
    What do you mean?
• jokoon 13y ago
  what makes whatsapp so attractive already ? I don't understand how it really avoid the SMS cost... I mean you can't have a data plan across the entire world...
  • neves 13y ago
    Free wifi.
• CmonDev 13y ago
  Is it even real money that those companies are exchanging? I can't believe it's same stuff I use to buy bread.
• IE5point5 13y ago
  Facebook reaches desperation, not long now till the collapse
• tuxguy 13y ago
  A well-written article which traces the lives of Jan Koum & Brian Acton in some detail http://www.forbes.com/sites/parmyolson/2014/02/19/exclusive-inside-story-how-jan-koum-built-whatsapp-into-facebooks-new-19-billion-baby/ http://www.forbes.com/sites/parmyolson/2014/02/19/exclusive-... Koum : “I want to do one thing, and do it well.”
• weixiyen 13y ago
  It's a crazy amount to pay, but in mobile software only 2 things really matter - Photos and Messaging. These are the only 2 things that are universal to every single person on this planet who owns a mobile device and if you want to be #1 overall in the mobile space, you need to win in these 2 things. If this guarantees FB winning the messaging war, then it's worth it. I still think that Facebook needs to buy SnapChat, Line and WeChat to close the deal and fulfill their dream of connecting the world.
• danhopwood 13y ago
  As I tweeted this morning: https://twitter.com/dan_hopwood/status/436411010212454400 https://twitter.com/dan_hopwood/status/436411010212454400 WhatsApp is to messaging what PayPal is to payments. Right product, right time. Slow design iteration & little innovation over time. But as we've seen, it hasn't mattered. Stripe, Line, WeChatApp know all too well that moving off such established players is tough.. but not impossible.
• mknits 13y ago
  Facebook is now like American Kingfisher! Users from India will understand.
• downandout 13y ago
  $3 billion in employee RSUs/~50 employees=~$60 million each. There are some very happy WhatsApp engineers today.
• tomkin 13y ago
  This tech bubble is different. http://www.businessweek.com/magazine/content/11_17/b4225060960537.htm http://www.businessweek.com/magazine/content/11_17/b42250609...
• deleted 13y ago
  [deleted]
• karthikeleven 13y ago
  Now, you can finally say: It is OK to be a social startup and not be based out of San Francisco.
• newscracker 13y ago
  For those who're disturbed by this and would like to get away from WhatsApp, the least you can do is delete your WhatsApp account, followed by deleting the app itself. [This does not protect you from WhatsApp transferring all your data to Facebook] Follow the instructions for your device to delete your WhatsApp account: iPhone - http://www.whatsapp.com/faq/iphone/21325453 http://www.whatsapp.com/faq/iphone/21325453 Android - http://www.whatsapp.com/faq/en/android/21119703 http://www.whatsapp.com/faq/en/android/21119703 BB10 - http://www.whatsapp.com/faq/en/bb10/28020005 http://www.whatsapp.com/faq/en/bb10/28020005 Windows Phone - http://www.whatsapp.com/faq/en/wp/21335316 http://www.whatsapp.com/faq/en/wp/21335316 Nokia - http://www.whatsapp.com/faq/en/nokia/21477616 http://www.whatsapp.com/faq/en/nokia/21477616 Blackberry - http://www.whatsapp.com/faq/en/bb/21306771 http://www.whatsapp.com/faq/en/bb/21306771 --- Also, Telegram is wicked fast in my personal experience. I see a trickle of people joining Telegram over a period of time (well before this acquisition).
• Srinivas_Tamada 13y ago
  Very height price
• imarihantnahata 13y ago
  And now, WhatsApp is down!
• mnl 13y ago
  Aaand WhatsApp is down... on Saturday night (GMT+1). Chaos looms over Spain as we can't remember when was the last time we used anything else to send plans for tonight.