Facebook Buys Whatsapp: Why Did Mark Zuckerberg Think the Messaging App Was Worth $19 Billion?
The social media giant, Facebook, has decided to buy the mobile messaging app called WhatsApp for $19 billion in cash and in stock. This decision came after Facebook has identified ways to increase its popularity amongst the younger audience. Also, Facebook believes that, by combining text messaging and social networking, it will be easier for mobile device users to communicate.
WhatsApp now has almost a billion users. According to Mark Zuckerberg, the co-founder and CEO of Facebook, WhatsApp has about 1 million newly registered users on a daily basis. He believes that this Messenger app will provide additional options for Facebook users who want to chat with ease. As a part of this deal, the CEO of WhatsApp, Jan Koum, will be a part of Facebook's board. In return, Facebook will grant additional $3 billion in restricted stock units to all founders of WhatsApp, including Koum himself. Facebook will pay $4 billion in cash and $12 billion in stock, giving it a total of $19 billion.
Facebook said that they would keep WhatsApp service and brand. WhatsApp will also continue operating independently within Facebook. If they fail to comply with this agreement, they have pledged a $1 billion worth as a break-up fee. Based on the plans laid down by Facebook, they wanted WhatsApp to grow and connect the entire world. It is also expected to contribute in the efforts of forInternet.org, which allows basic Internet services available to all.
"I'm thrilled that they chose to work with us. I'm looking forward to what Facebook and WhatsApp can do together, and to developing great new mobile services that give people even more options for connecting," added Zuckerberg. He can't wait to see WhatsApp joining Facebook in its effort to connect people from all over the world. This partnership is bound to have a promising future.
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