3 ms·
Big difference: Skype had many more than the handful of employees needed to run WhatsApp. Their cost base was hundreds of millions. WhatsApp seems to run lean
by swombat 13y ago
Big difference: Skype had many more than the handful of employees needed to run WhatsApp. Their cost base was hundreds of millions.
WhatsApp seems to run lean and mean, and that makes a big difference in terms of keeping it profitable.
- 001sky 13y agoThis is slightly misleading in that a business with no revenues doesn/t have that much work to do.
- sbarre 13y agoWhatsApp didn't have "no revenue", they had a much simpler revenue stream.. But your point stands. No doubt a lot of Skype's operation costs were the business and marketing side of things.
- swombat 13y agoWhatsApp makes $1/user/year after the first year, and appears to keep users around pretty much forever because it's such a good deal. So that's a revenue that, today, is probably a sizeable fraction of $400m/year. All that with a few dozen employees.
- pjbrunet 13y agoAssuming Google/Apple maintain respective strangleholds, continue to share the wealth, etc. The "app store" craze could fizzle out, nobody knows for sure.
- 001sky 13y agoYou guys are taking this comment to litterally. Sales, marketing, accounting, legal, and financial controllership are going to skyrocket when this company has a revenue stream that is worth NPV=$19B. This is a credit to the company; who like instagram was able to build much value with few FTE's. But building a company "worth money" and building a company "making money" are really different things. This is smart from a founder's perspective, because in a sense all of those other employees would just be dilutive of attention and likely equity. But from an economic perspective, it's jumping the gun a bit to conclude what the steady state economics will be.