Facebook Inc. (NASDAQ:FB)’s acquisition of WhatsApp for $19 billion from the former Yahoo employees, has suddenly raised the market worth of all but 11 Indian companies. CEO of WhatsApp, Jan Koum became a billionaire overnight after this deal.
WhatsApp has 450 million users worldwide, and one million adding each day. Rumours suggests that Google Inc also tried its luck at acquiring the popular messaging service, before the deal struck. Reportedly Google had made an offer of 10 billion for the messaging App.
It’s a five-year-old company, and the deal involves $4 billion in cash, there are $12 billion in stock and $3 billion in restricted stock vesting over several years. The worth of this deal is more than what FB raised in its own IPO, all that reveals company’s determination to win the market for messaging. In history of Wall Street nothing like this happen before, What Facebook paid for buying WhatsApp is more than what Google Inc (NASDAQ:GOOG) paid for Motorola, Oracle Corporation (NYSE:ORCL) for Sun Microsystems and Microsoft Corporation (NASDAQ:MSFT) for Skype.
Co-founder Jan Koum would take a place at Facebook Inc (FB)’s board and has assured that ‘nothing’ would change for users immediately as Facebook plans to run WhatsApp independently, much like Instagram.
A director of product management at Yahoo, Shameek Chakravarty, who was also the president of the entrepreneurship and venture capital club at ISB, he said that his career really took off with Google, where he was also thinking of either launching a startup or funding one.
Chakravarty further said that, “when Arora went to Mountain View, his role involved hunting down startups for Google and that meant meeting and connecting with numerous people in the Silicon Valley to understand what was happening in the market”.
Chakravarty said, “Over the years, we have connected to discuss how I should manage my startup, which I sold in 2012,” adding he had even told Arora that WhatsApp would make a really good exit and that he should fund his friend’s startup with his share of that fortune. In May 2013, Arora told ET in an interview that WhatsApp is very different Facebook Inc (FB), Google Inc (GOOG), or Yahoo (YHOO).
Leave a Reply