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How might the $19 billion purchase price have been derived?
short of the $19 billion price tag that Facebook paid. potential competitor in the social media space, as well as the primary competitor of SMS. WhatsApp were valuable to Facebook, and created future opportunities for growth and profit, which is how the $19 Billion purchase price was derived.
How does Facebook benefit from WhatsApp?
Facebook’s acquisition of WhatsApp benefits the social network in a three important ways: It better positions it to reclaim the teen demographic, a key group of users who have grown disinterested in Facebook; it allows Facebook to buy its way into mobile messaging, one of the hottest emerging markets that the social …
Why did Facebook buy WhatsApp for 19 billion?
As per Porter’s 5 forces analysis, WhatsApp was becoming a threat of substitutes for the company. WhatsApp was growing steadily in its percentage of market reach beating out popular mobile apps. So, Facebook saw both vulnerability and opportunity in WhatsApp and acquired it for a whopping $19B in 2014.
How was WhatsApp valued?
To cover the cost of sending verification texts to users, WhatsApp was changed from a free service to a paid one. By February 2013, WhatsApp had about 200 million active users and 50 staff members. Sequoia invested another $50 million, and WhatsApp was valued at $1.5 billion.
Did Mark Zuckerberg bought WhatsApp?
Facebook purchased WhatsApp in 2014. WhatsApp has over $2 billion users.
How much is WhatsApp worth?
WhatsApp revenue
| Year | Estimated revenue |
|---|---|
| 2014 | $1 million |
| 2016 | $0.2 billion |
| 2018 | $1.3 billion |
| 2020 | $5.5 billion |
How does WhatsApp make profit?
WhatsApp doesn’t earn revenue through advertisements. The founders hated advertisements and created this ad-free platform focusing just on great user experience and interface. They wanted to create an instant messaging platform for the users and not for the big companies to place ads.
Is WhatsApp owned by Facebook?
WhatsApp Messenger is a freeware and cross-platform messaging and Voice over IP (VoIP) service owned by Facebook. The application allows the sending of text messages and voice calls, as well as video calls, images and other media, documents, and user location.
Why did Facebook acquire WhatsApp?
Mobile Connectivity. Facebook focuses a lot on mobile communication and WhatsApp is the right partner to achieve its ambitious goals.
When did Facebook acquire WhatsApp?
The app was founded by Jan Koum and Brian Acton , two former Yahoo! ( YHOO ) executives. When Facebook announced its plans to acquire WhatsApp in February 2014, WhatsApp’s founders attached a purchase price of $16 billion: $4 billion in cash and $12 billion remaining in Facebook shares.
What is Facebook acquisition?
The acquisition is a shortcut to owning those growing markets. Facebook must buy its way into “ephemeral” and/or “dark social” communications.