The mind boggling valuation of WhatsApp

by Manshu on February 20, 2014

in Uncategorized

I was dumbfounded by the incredible price that Facebook paid for WhatsApp earlier in the day today.  For those of you who still haven’t heard the news, Facebook paid an incredible $19 billion for WhatsApp today! 

Those are American Dollars, not Zimbabwean!

It is hard to fathom how big this number is and even harder to think that a company with just 55 people can be valued at so much!

At today’s exchange rate, there are only 15 Indian companies that are worth more than WhatsApp, and I know these comparisons are a bit ridiculous but WhatsApp is worth more than the GDP of Nepal!

The thing that most amazes me about WhatsApp however is not the price but the number of employees and the realization that scale means quite a different thing these days than it used to a few years ago, and a lot of companies are supporting billions of transactions per day without having to spend insane amounts of money on infrastructure. I’ve recently bought some shares in Salesforce.com which is a pioneer in cloud computing, and they support a ridiculous number of transactions per second as well. They crossed a billion transactions a day mark about two years ago. Twitter routinely discusses their high transaction volume, and Facebook is talking about 3 billion users!

Finally, in terms of user experience, it seems like Facebook is not looking to show ads on WhatsApp right away, but they may want to make you tie the account to your Facebook in addition to your phone number, and then all your data sent through WhatsApp is stored with them as well, and that’s nothing to be excited about.

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