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

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

#181
post #141

Earlier quoted context omitted.

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.

You really think Instagram was a bad purchase.

No one can tell, really. Arguably, Instagram was bought for what it could have been, not for what it was.

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

#182
post #75

Earlier quoted context omitted.

Or facebook is trying to trivialize and destroy the startup market.

Destroy? There will be a host of new messaging startups created off the back of this, and suddenly the Snapchat valuation looks sane. Do one thing that Facebook does but better is the new gold rush. Sure, most of them will fail hard without raising a cent in revenue, but others will start to threaten to chip away at Facebook's market share.. Anecdata: I get a lot more messages on FB messenger than WhatsApp...

Whatsapp has virtually no market share in the US. In basically all markets outside of the US, however, they are dominating the messaging space. Text messages in major EU countries like Germany and France have been almost completely supplanted by WhatsApp.

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

#184
post #60

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 contin…

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).

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

#185

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...

And after that think about Flickr selling to Yahoo for like $20m?

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

#186
post #44

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-... $20M net revenue, at most, right? With future expansio…

Whatsapp charges $1/year IIRC. So, with 400MM users, you can expect ~$400MM/year revenue?

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

#189
post #63
post #19

http://blog.whatsapp.com/index.php/2012/06/why-we-dont-sell-...

according the WhatsApp blog, its going to be staying ad-free. http://blog.whatsapp.com/index.php/2014/02/facebook/

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.

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

#190

Earlier quoted context omitted.

Why do you love it? I'm honestly curious as to what it does that SMS, Messenger or other messaging apps don't do.

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…

"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."

I like how you nailed the reason for Facebook buying WhatsApp.

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