They charge $1/year with the first year free. Last year they had ~250M users and today they have 450M. So, about 50% (or 40% or 20%) of their user base is paying $1/year. So, their annual revenue is $90M - $225M depending on the assumption. Even with a $1M/employee burn rate, their op ex is Another data point on their finances - The only external funding they've taken is $8M from Sequoia in 2011. It's unlikely that that could last them till now with 32 employees.
Numbers That Explain Why Facebook Acquired WhatsApp
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Re: Numbers That Explain Why Facebook Acquired WhatsApp
#12From 5 minutes of reading it seems that it's huge in overseas markets where people want to avoid the cost per SMS message fee, am I correct? If you have a standard plan with the phone giants in the US, all calls and texts are generally unlimited, but you pay for data now. Is that why it's not as big in the US?
Not that alone. Here in the UK SMS is often unlimited. People still prefer to use Whatsapp. I and most of my friends have virtually stopped using SMS.
Another advantage are international SMS. Again more relevant for say Europeans than for Americans.
Re: Numbers That Explain Why Facebook Acquired WhatsApp
#13So I understand the value of WhatsApp now that the network is absolutely enormous, but can anyone shed some light on how WhatsApp differentiated itself at first?
It seems like it's just basic user-to-user messaging over data, with a list-like interface that looks like every messaging app on my phone. How did they convince people that this particular proprietary solution was the best? Did they somehow remove friction in getting your friends to join? I feel like using Google Hangouts or any other proprietary messaging service is the same... I must be missing something.
Re: Numbers That Explain Why Facebook Acquired WhatsApp
#14I'm astounded at how frequently people are apparently making breakthroughs in sending raw text between people. I keep thinking that's a mousetrap, and people somehow keep making money off of* better ones. Shows how much I know. * Or at least building huge userbases on...
It's never really about the raw text itself, but the context. Facebook, Whatsapp, Forums, Twitter, SMS, Etc... are all just text but in radically different contexts. Something tells me we haven't seen the last of the innovations in good ol' plain-text.
Re: Numbers That Explain Why Facebook Acquired WhatsApp
#15The nmbers are actually irrelevant. The key thing is that Whatsapp has the potential to become a rival to Facebook (or be acquired by some company that seeks to compete with Facebook). Facebook needs to avoid that at all costs, so is prepared to pay whatever it takes to acquire potential rivals, thus removing the threat. See https://news.ycombinator.com/item?id=7267516
You know, since I heard the news I kept hearing people make that argument and I thought, "But Whatsapp and Facebook are completely different products and markets." ... And then I realized that the only thing I use Facebook for is keeping in touch with people. And Whatsapp could easily fill in for 80% of what I do on Facebook. Indeed, they are trying to neutralize competition.
Sadly, I remember the days of Microsoft's near-monopoly on desktop computing, and I'll be getting rid of whatsapp within the week. On to Telegram or whoever is willing to make an identical app that isn't owned by FB or Google or whoever. The question will be whether I can convince others to switch.
Re: Numbers That Explain Why Facebook Acquired WhatsApp
#16How much did they pay for Beluga in 2011 (which then became Facebook Messenger - an app that does pretty much the same as Whatsapp, if not more)?
How little (if anything) did they spend in Marketing that app since?
Sounds like a costly mistake.
Re: Numbers That Explain Why Facebook Acquired WhatsApp
#17They charge $1/year with the first year free. Last year they had ~250M users and today they have 450M. So, about 50% (or 40% or 20%) of their user base is paying $1/year. So, their annual revenue is $90M - $225M depending on the assumption. Even with a $1M/employee burn rate, their op ex is Another data point on their finances - The only external funding they've taken is $8M from Sequoia in 2011. It's unlikely that t…
Profitable sure, but I'm curious what their plans for expansion on that profit is. At best right now, they can hope for $450m next year. Even if they got all of that, it'd take more than 30 years to make Facebook their money back.
So there's something they're wanting to do, a means of making money, that we don't know yet. I'm genuinely curious what they're thinking about.
Re: Numbers That Explain Why Facebook Acquired WhatsApp
#18So I understand the value of WhatsApp now that the network is absolutely enormous, but can anyone shed some light on how WhatsApp differentiated itself at first? It seems like it's just basic user-to-user messaging over data, with a list-like interface that looks like every messaging app on my phone. How did they convince people that this particular proprietary solution was the best? Did they somehow remove friction…
The post mentioned that all WhatsApp's early competitors benefited through advertising, while WhatsApp dedicated to keep the UI clean, and earn revenues by charging users one dollar a year.
Re: Numbers That Explain Why Facebook Acquired WhatsApp
#19So I understand the value of WhatsApp now that the network is absolutely enormous, but can anyone shed some light on how WhatsApp differentiated itself at first? It seems like it's just basic user-to-user messaging over data, with a list-like interface that looks like every messaging app on my phone. How did they convince people that this particular proprietary solution was the best? Did they somehow remove friction…
I am not a WhatsApp user but a number of my friends use it. I think what they did well are: (1) You automatically upload your contact list to their servers. If any of friends start to use WhatsApp you will see it on the list (2) Smart phones were gaining adoption in many Asian markets and their value proposition of cheap unlimited messaging plan resonated very well (3) They charged for their product after initial adoption so they don't have to be tied to VC money forever and avoided annoying users with ads.
Re: Numbers That Explain Why Facebook Acquired WhatsApp
#20The nmbers are actually irrelevant. The key thing is that Whatsapp has the potential to become a rival to Facebook (or be acquired by some company that seeks to compete with Facebook). Facebook needs to avoid that at all costs, so is prepared to pay whatever it takes to acquire potential rivals, thus removing the threat. See https://news.ycombinator.com/item?id=7267516
You know, since I heard the news I kept hearing people make that argument and I thought, "But Whatsapp and Facebook are completely different products and markets." ... And then I realized that the only thing I use Facebook for is keeping in touch with people. And Whatsapp could easily fill in for 80% of what I do on Facebook. Indeed, they are trying to neutralize competition. Sadly, I remember the days of Microsoft's…
i'm not really sure they're the same.
seems to me that whatsapp is more of an active "keeping in touch with friends" where facebook's forte is more of a passive "keeping in touch with friends". that would make them fairly harmonious in my book -- hence the autonomy.