Agenda
1
WhatsApp
Concepts, Business Model,
Profit/Loss, Opportunities
2
FaceBook
Valuation, Reasoning,
Opportunities
3
Hindsight
How it worked out,
Statistics
2
WhatsApp
A very brief history
1
3
Introduction
Established by Brian Acton and
Jan Koum in 2009, WhatsApp is a
freeware, cross-platform text and
media communication platform.
4
WhatsApp Business Model
The Idea
Provide a free to use
messaging platform
which respects user
privacy, is easy to use,
and shows no ads.
Monetization & Scale
As the userbase
grows, so does the
opcosts.
Means of profit:
- Ads
- Subscriptions
- User Data
5
WhatsApp Business Model
Founders were strictly against them
Means of profit:
- Ads
- Subscriptions
- User Data
Opposed the initial vision
Founders were privacy activists
6
WhatsApp Business Model
1
2
3
None
1$ Subscriptions
Investments
Founders paid out of
their own pockets to
keep it afloat.
For a measly 1$/year
cost users could use
the app.
Once they gained
momentum, investors
were eager to fund
them on very favorable
terms.
7
WhatsApp Business Model
1
2
3
None
1$ Subscriptions
Investments
Founders paid out of
For a measly 1$/year
While
looked definitely
plausible
and smart,
their
ownitpockets
to
cost
users could
use
keepthis
it afloat.
app. sustainable.
method was by nothe
means
Once they gained
momentum, investors
were eager to fund
them on very favorable
terms.
8
WhatsApp Statement of Operations
In thousands
9
FaceBook
Reading between the lines
2
10
“
If you are not paying for a product,
then you are the product.
11
About FaceBook
Advertisers
FaceBook is in the
surveillence business;
and the most
powerful.
Monopolistic
FaceBook is extremely
monopolistic and
anticompetition.
Track Record
They have a terrible
history of scandals and
misdeeds.
- Cambridge Analytica
- Voter influence
- Privacy
12
WhatsApp
Was
Promising
13
WhatsApp
Was
Promising
14
WhatsApp
Was
Promising
15
An Offer
You
Can’t
Refuse
16
An Offer
You
Can’t
Refuse
FaceBook initially offered to purchase WhatsApp
for $16 B; $4 B in cash and the rest in stocks.
However, it valuated the business to be worth
$17.2 B and settled for $19.6 B.
By the time the news broke, FaceBook’s stocks
soared and they ended up paying $21.8 B.
17
Hindsight
How did it work out?
3
18
Alerts Going Off
Investigations
Given FaceBook’s past,
many countries
launched
investigations and
advised caution.
Promises
FaceBook promises
not to share
WhatsApp’s data with
FaceBook.
Doubts
Many were rightfully
doubtful about the
valuation and future.
There were fears of
Embrace, Extend,
Extinguish actions.
19
Number of
Active Users
In thousands
20
Monthly
Time Spent in
WhatsApp
In hours
21
Messages Sent
Each Day
22
Extending Functionality
WhatsApp Business
It eases business
communications with
customers, FB makes
money from late
replies.
Payment Services
Working with more
than 100 banks,
WhatsApp offers direct
payments, catalogs
and much more.
The Future
FaceBook, now Meta,
has mentioned their aim
to merge all their
services many times.
23
The Grim Truth
Broken Promises
Despite Zuckerberg’s
promise not to use the
data, he did so from
the start.
Lies
FaceBook claimed it
was “Technically
impossible” to merge
the data from
WhatsApp with
FaceBook. That was a
lie and lead to a fallout
with the founders.
Crossing The Line
WhatsApp was the
missing link FaceBook
needed all along to
bridge the online and
offline spaces.
24
Conclusion
25