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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

#411

Post by highCs »

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…

  400,000,000 active users [0]
  16,000,000,000 USD
  10 years
  ----
  $4 per user and per year

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

#412

Post by d4nt »

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 was talking to a lawyer earlier today and she said something like "97% of Facebook's value is in their IP (intellectual property)" and I silently thought, no, their entire value is in the fact that they have active users. Without the network effects of active users, they are worth almost nothing.

They are like a social networking black hole, what makes them big is that they are already big, and that's all.

So if anyone starts taking away their daily active users, even if they were only taking a few percentage points off Facebook's metrics, they are effectively threatening to break Facebook's business model and put them out of business, and it makes sense to spend almost anything they can afford to neutralise that threat.

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

#414

Post by KaoruAoiShiho »

psbp wrote: post #348
KaoruAoiShiho wrote: post #275

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...

Social isn't serious. It really shouldn't be.

Obviously the best way to communicate is via carrier pigeons.

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

#415

Post by yla92 »

MichaelGG wrote: post #330
rokhayakebe wrote: post #280

Earlier quoted context omitted.

Why not? ~50 employees, a couple of years old, $8M in funding.

50 employees? That's awesome. Twitter has like over 2000. Sure, Twitter's infrastructure is more complicated, but still.

From this blog post[0], "WhatsApp runs lean. With only 32 engineers" I am very impressed.

[0]: http://sequoiacapital.tumblr.com/post/77211282835/four-numbe...

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

#416

Post by crucialfelix »

ams6110 wrote: post #405
pitchups wrote: post #131

Earlier quoted context omitted.

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.

WhatsApp has huge global growth. I heard that little chirp everywhere I went in India. friends in Africa use it all the time. in countries with SMS charges, whatsapp is a good deal.

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

#418

Post by Trufa »

staunch wrote: post #170

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.

I'd just like to mention that in some countries (Uruguay for example) it's becoming the go to social networks, the "hot" news and stuff are spreading though WhatsApp and not though FB anymore.

I guess that could be one of the factors that made them very interested in acquiring.

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

#419

Post by adventured »

mudil wrote: post #360

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?

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.

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

#420

Post by nullspace »

ams6110 wrote: post #405
pitchups wrote: post #131

Earlier quoted context omitted.

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.

It's not really "pop" technology. Surprisingly, it's not used much in the United States, but in India it's basically a replacement for text messaging. Everyone from a 13 year old child to my grand mom uses it to keep in touch with friends and family members across the globe.

IMHO, they were able to get to such widespread everyday usage because they such awesome and reliable technology. Much better than what Google have been able to provide with their hangouts app, for instance. Messages are always delivered instantaneously if you are online. If you are offline it stores it locally, and delivers it the moment you are online without messing up the order.

Never had any issues with them. They are really awesome. Congrats to them - IMO it's a great acquisition by Facebook.

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