Thursday, February 20, 2014

Facebook to acquire WhatsApp in USD16 billion

Finally WhatsApp is ready to sell for a price. In the 16 billion deal, 4 billion are in cash. According CNET WhatsApp monthly active users more than Facebook, in terms of growing rate since they start up. This is not truly fair comparison as both company started at different time. In simple word, WhatsApp is growing fast, For Facebook, WhatsApp is rival. By acquiring WhatsApp, Facebook increase their user base and one thing less to worry about.

Photo from flickr

Does WhatsApp has a business model? Yes, the first year is free, but the subsequence subscription fee is USD1 per year. WhatsApp is just a small size company with 55 employees now. WhatsApp has more than 400 million monthly active users.

Last year there was a rumour that Google and WhatsApp in talk of acquisition, but WhatsApp has denial that (refer here Won't sell-out to Facebook or Google: WhatsApp). WhatsApp never need to worry about money, they were funded 8 million by Sequoia Capital, should be enough for them to operate for some time.

There is a story of how Koum and Acton co-founded Whatsapp. Koum and Acton working in Yahoo before the co-founded WhatsApp. Both of them applied job in Facebook but rejected. Read the story here.

Rumor saying that Google offered 10B for WhasApp.

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