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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

#351

Post by rahimnathwani »

ojbyrne wrote: post #127
chrislloyd wrote: post #73

Earlier quoted context omitted.

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. However people feel about the VC game, 400x IRR are why so many people play.

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.

Another minor quibble: IRR is usually expressed as a percentage (e.g. 700% per year rather than 7x).

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

#352

Post by johngalt »

shmerl wrote: post #174
johngalt wrote: post #148

Earlier quoted context omitted.

The closest option is XMPP. Unfortunately it's suffered an extreme case of scope creep. http://en.wikipedia.org/wiki/XMPP

Whatsapp uses XMPP for the reference. However they modified the protocol to be incompatible (on purpose) and it's not federated obviously.

It's accurate to describe the XMPP standard as 'used' by many but 'supported' by few.

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

#353

Post by Cookingboy »

hatred wrote: post #38

Today , I feel I am really bad at maths counting return percentages. Sigh $8m -> $16b.

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?

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

#354

Post by yapcguy »

varenc wrote: post #63
jljljl wrote: 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/

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.

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

#355

Post by pbhjpbhj »

primitivesuave wrote: post #103

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 imp…

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 or http://www.whatsapp.com/legal/

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

#356

Post by tomasien »

josh2600 wrote: post #104

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…

Plus, if FB sold Instagram to someone else (like the public) today, they'd make a massive return on 1 billion dollars. Massive.

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

#358

Post by BugBrother »

ulfw wrote: post #307
jamra wrote: post #255

Earlier quoted context omitted.

Maybe they're not just paying for users. Maybe they're paying for the strong infrastructure of the messenger and the talent associated.

And what's the point of it? They already have a working push messaging infrastructure for 1+ Billion people.

Yeah, at a minimum they should have been able to lower the price by threatening to make the exact WhatsApp functionality a subset of Facebook.

(A page out of Microsoft's play book.)

Edit: The Facebook Messenger has the features of WhatsApp already?! News to me, so you have a point re FB advertisement. :-)

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