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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

#401

Post by rokhayakebe »

antr wrote: post #29
falsestprophet wrote: post #15

Some interesting numbers: WhatsApp raised only $8 million (from Sequoia in 2011 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.

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"

I wish your comment found its way to the top of the main thread.

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

#402

Post by pbhjpbhj »

greenpresident wrote: post #235
continuations wrote: post #114

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?

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.

>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).

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

#405

Post by ams6110 »

pitchups wrote: post #131
nwh wrote: 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…

Pretty amazing that this is precisely what Microsoft paid for Hotmail in 1998 : $400 million for 10 million users = $40 / User. [1] The parallels are striking : Whatsapp is to messaging today what Hotmail was to messaging in the late '90s. [1] http://news.cnet.com/2100-1033-206717.html

I'll admit to a distinct feeling, that I've started to lose touch with pop technology. I've never heard of WhatsApp. Though I had most definitely heard of Hotmail in 1998.

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

#406

Post by blantonl »

bedhead wrote: post #64

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.

There is the old wall street saying - "The market can stay irrational longer than you can stay solvent."

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

#407

Post by argumentum »

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.

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

#408

Post by adventured »

elwell wrote: post #208
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…

It also tells the next Whatsapp that they can hold out for $20B.

How much time is left on the party clock? I have no idea, but typically when things are getting really crazy like they are now, the clock is almost out.

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

#409

Post by debt »

nwh wrote: 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 feel like the 'book is having trouble adding new users. This is probably another stab at inflating their numbers for their Q earnings reports.

There are a limited number of users out there. Emerging markets aren't growing fast enough and aren't going to be strong soon enough to support the FB's growth rate. It seems investors rely a lot on the daily users metric as it translates into more potential advertising revenue.

This acquisition will certainly help that number, daily active users.

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

#410

Post by pbhjpbhj »

MichaelGG wrote: post #397
wudf wrote: post #89

At least we'll still have viber

Viber was just bought last Friday for $900M by Rakuten.

>"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] //
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