Mark Zuckerberg (image 001)

Since Facebook announced last week that it would be acquiring WhatsApp for $16+ billion, pundits have been trying to make sense of the deal. How can a messaging app startup be worth so much more than say, Motorola Mobility, which has thousands of employees?

According to Mark Zuckerberg, it’s not. It’s worth more. Speaking at Mobile World Congress in Barcelona yesterday, the CEO said that WhatsApp was a ‘great fit’ for his company and that it was worth more than the $19B ($16B + $3B in vested shares) they paid for it…

Bloomberg reports:

Facebook Inc. (FB) Chief Executive Officer Mark Zuckerberg said WhatsApp Inc., which his social-media company agreed to buy last week, was “worth more than $19 billion. The mobile-messaging startup was “a great fit for us,” Zuckerberg said at the Mobile World Congress in Barcelona yesterday. “Already almost half-a-billion people love using WhatsApp for messaging and it’s the most engaging app we’ve ever seen exist on mobile by far.”

 

The acquisition, which consists of $4 billion in cash, $12 billion in Facebook shares, and $3 billion in shares that will vest over the next several years, is the largest ever by the 10-year-old Facebook. It’s also the most expensive for an Internet company since the early 2000’s.

“WhatsApp is well on its way to connecting 1 billion people, Zuckerberg said, and few services in the world attain that reach without becoming valuable. WhatsApp has more than 450 million users a month.

“I think by itself it’s worth more than $19 billion,” he said. “It’s hard to exactly make that case today because they have so low revenue. … I could be wrong—there is some chance that this is the one service that gets to a billion people and ends up not being that valuable—[but] I don’t think I am.” 

Will Mark’s gamble pay off? Who knows. It doesn’t sound like he’s interested in putting ads in WhatsApp or raising its subscription fee of $1 per year, so monetization is still a major question. But I guess if nothing else, it makes for one less messaging competitor to worry about.

What do you think?

  • Downfall

    Facebook will be dead by 2025.

    • Modest

      I hope so.

    • Matt Dowdy

      I hope you mean USA time. It’s already 10:05 in the UK…….

    • on3simpleclick

      I hope a lot eariler than that. I honestly want to see something else become the new ‘go to’ social network/site.

    • Agru

      Why are you all so full of hatred? It’s a nice social network that made my life (and a lot of other people’s too) much simpler. I sincerely hope it won’t because I don’t want to export all my photos and data to another site..

      • blastingbigairs

        Because most people (maybe not you) use it AS their lives and can’t stop posting stupid sh** all day long instead of doing productive things. Kids and adults without a lives don’t even know what it’s like to go on a hike, or read a book anymore. FB has ruined mankind. FB has become an addiction to some people and it’s really gross. Just my observation.

      • Agru

        Oh man, when you are a university student you have no time for posting bullsh*t. Plus, it’s very useful to stay in touch with the other 250 people in your class, like for quickly sharing messages from professors. Whatsapp or Twitter really can’t help here.
        Anyway, thanks for explaining your pov!

      • blastingbigairs

        And that’s what is was made for, not bored housewives posting pictures of their lattes haha!! Good stuff!!

      • Agru

        “Harvard connect” like in The Social Network right?
        Not exactly Starbucks Connect LOL

    • Marcus

      Are you stupid? Do you realize how rich Facebook is? They are just buying out all of the competition and making loads of money. What makes you think that they will die out?

    • iPhoner

      Wait…so Facebook is still around? Interesting 😛

    • blastingbigairs

      I wish it would come sooner, it’s officially America’s biggest waste of time, likely the planet.

  • Jonathan

    Twitter will live..

    • Agru

      No please!

      • “Why are you all so full of hatred” …sorry just had to 😀

      • Agru

        Lol ok I was misunderstood =D I don’t hate Twitter, I just meant I hope it won’t be the only one left in a couple of years. (I think he was replying to the first comment and implied fb’s death)

  • Burge

    You forgot to put the wording “WAS”

  • Brandon Weidema

    of course its worth more than 19 billion once Facebook brings out the data pickaxes and chisels from the closet…

  • anonymous

    I just dont get it still, how come a simple app be worth 19bil when most richest companies of the world is not worth the same amount, it is totally overvalued, granted that whatsapp is the most popular messaging app but the other side of the spectrum, there are loads of similar apps around every corner in app stores for free, and whatsapp is not yet popular in all regions, there is viber,line,wechat,tango,instamessage etc etc and some of these are dominant in select regions. now only time can tell if their $1 per user/year will yield enough

    profits to recoup their profit in some years, or customers will look for alternative ways who don’t purchase or share their credit details online.risky business…

    • Eni

      I still don’t get it how did you write all this :/

      • Derp

        with a keyboard

      • Eni

        i think that the keyboard and his fingers are burning

      • anonymous

        i just cant stop laughing right now, honestly, i saw notification in disqus on this post and thought ,Ok!, someone wrote a reply, but when i was redirected here, and saw your silly comment, i tore apart. i think what i wrote here is smaller to the other comments by me. actually u can see a lot of people comment definite statements true or untrue without backing it up, well this seems silly to me, i like to back my sentences with some valid reasons.

      • Eni

        just kidding man, but i have to say that it tok 2 days to write that replay, sooo.. :p

  • omrishtam

    the NSA will put even 100 billion dollars for an app like this

    • omrishtam

      sorry i ment facebook

  • Hyr3m

    There’s a zucker born every minute.

    • Chetan

      A sucker too.. Lol.. But only a few make their life worth..

      • Hyr3m

        Yeah that Mark has made his life worth … ending.

  • Shandeep Segar

    Facebook is trying to diversify it’s organization because now its the decline time for FaCeBoOk elimination of its competitors will reduce the rate of decline BUT Facebook will still be declining, you can’t accurately say when it will be dead like Myspace.