25
Feb

Why the WhatsApp Deal Will Inspire on a Global Level

Has anyone noticed that the narrative surrounding the WhatsApp deal has been a little different? When the Instagram deal happened, many thought it was insane #norevenuenoproblems. When SnapChat turned down 3B the discourse was even more intense and critical (this one was perhaps warranted). However, majority of the headlines about this most recent event have been welcoming, focusing on the tremendously inspiring story of the founders and the eye-popping user/growth numbers. And this is despite a lofty valuation that often gets criticized by the haters out there…  I mean 345M per employee. Maybe because it takes a lot more to shock and awe nowadays or maybe it’s because of those inspiring tweets from co-founder Brian Acton.

Company Valuation Rev Per Employee
Instagram 1 Billion 70 million
YouTube 1.7 Billion 26 million
SnapChat 3 Billion (offer) ~100 million
WhatsApp 19 Billion 345 Million

Regardless of valuation and evaluating what Facebook could have done with the money (2 Hubble Telescopes), I think that the deal is great because it will inspire thousands of new entrepreneurs for years to come.

It’s Super Global

An interesting and important aspect of the WhatsApp story is its global footprint. Though based in Mountain View, WhatsApp is much more popular outside of the US than within the country (I’m sure this deal will fuel exponential US based user growth). Because it is so widely used in abroad this deal will resonate that much more with young hopeful individuals in emerging countries, like India, looking to start their own thing. We get inspired by success stories that we’re close to. The fact that millions of users use this platform to communicate on a daily basis cannot be overlooked. It’s more than just text messaging, it’s facilitating otherwise inaccessible communication. I’m heading to India next month and I’m going to predict that many entrepreneurs and start-ups will be a little invigorated as a result of this deal (we will await the results in a separate post).

It’s About Connectivity

WhatsApp is also a story about connectivity in two ways. 1) The company’s fundamental purpose is to facilitate communication on a global scale. In June the company reported it processed 27 billion messages in a single day. That’s insane. 2) It demonstrates the possibilities of scaling globally (in a big way) without a physical presence. I feel this will further inspire entrepreneurs abroad to build things not only for their home country/state/city, but for foreign consumption and even more so to facilitate interaction (beyond messaging) across borders. I hope to see a start-up in an emerging country achieve jaw dropping scale in a more developed nation(s) in the not so distant future.

It’s Ridiculously Inspiring

In a CNN interview Venture Capitalist Mark Suster said “WhatsApp will prove to be the most successful start to exit in the history of technology”. While I’m sure there will be plenty more mind-blowing success stories throughout the next decade, there is no doubt that the WhatsApp story is inspiring. Though it’s typically bad practice to start a company to be the next Facebook or assume your venture will experience Instagram like growth because of stories like these, these events do warm the soul and energize the entrepreneurial spirit… and you can’t really put a price on that.

Warmly and Humbly,

Rishi

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