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WhatsApp co-founder Brian Acton to leave company (reuters.com)
119 points by ghosh 11 months ago | hide | past | web | favorite | 69 comments

I swear to God, WhatsApp is THE startup fairytale.

No dilution, bootstrapped, greenfield tech and mind boggling earn out. A once in a generation business story.

I always mention WhatsApp when people want to do something overly complicated.

The fairytale for startup employees is probably Microsoft and its 10,000 millionaires. But that was two generations ago. A generation ago, it was 'The Google Chef' and far fewer millionaires though several thousand. While WhatsApp created a lot of wealth, it did not create a lot of wealthy people. That seems to be the trend.

To be realistic, Whatsapp is massive and popular, but totally incomparable to Microsoft or Google as a company. Whatsapp is a chat app, Microsoft is the operating system and office software of 1.25 billion computers around the world.

I don't think that the technical scope of the software or the company behind it were what was being measured against the notion of a "fairytale startup" by the parent, or the grandparent. They spoke of "greenfield tech", "mind-boggling earn out", "10 000 millionaires" but the product didn't have to be an entire operating system. A game could be a fairytale startup then. Flappy Bird would have done it for me

I guess, but if we're talking about the number of millionaires to come out of a startup, then I think the scope and size of the company is very relevant.

you're underselling it. yes, it's a 'chat app', but one that runs on a billion phones in every country on the planet

But it is still just an app, a messaging app at that. AFAIK no one I know has ever got the voice call function to work to a minimum standard. So whilst it is a useful and pervasive chat application that's all it really is.

You're not seeing it. It is, to some or other partial-but-very-noticeable extent, a Skype killer, an SMS killer, a GSM/CDMA voice call killer, an email killer, a Hangouts killer, a Facebook killer (yes i know they bought it), [insert many others here]. Communications are very important, this app is a beast. The voice calls work perfectly for me.

Voice calls on WhatsApp are simply fantastic. I'm not sure how you are measuring, but this is based on my experience in Brazil over Wifi and 3Gish 4G

Yup, WhatsApp voice calls beat Skype, hangouts, FaceTime audio, Slack audio. I don't know why, but I've tried them all. Somehow WhatsApp seems so much better.

Second this. WhatsApp uses the least data and can work well in network connection transition. Most importantly, it is binded to your phone number and can call people regardless of country (unlike Skype) .

If I remember correctly since 2016, WhatsApp is completly free from any fee charge? How is facebook planning to use that? Finally integrate with facebook?

Remember when Zynga clawed back options because "unimportant" employees were going to make money? Heck, remember Zynga?

Nowadays the 'google chef' would be an underpaid temp supplied by an agency.

You don't need a huge team to build WhatsApp or Instagram. Guess software is eating the world- including itself.

But you need a group of highly skilled team players. Which is a hard problem.

The reason for the trend, of course, is that companies are staying private longer to maximize returns for early investors and VCs.

Simplicity is part of it but it's really also the business model. With good focus they exploited a unique opportunity at just the right moment: SMS arbitrage. To offer "free" messaging when carriers were beginning to offer affordable data plans for third party apps, yet still trying to disproportionately monetize SMS. And this came with a very, very strong network effect.

If carriers had proactively disrupted their business model and offered free/cheap SMS sooner, it's unlikely that WhatsApp would have succeeded despite their simplicity and focus. This is why they never took off in the U.S., where carriers did away with SMS fees faster.

Having said that, focus is absolutely a reason why WhatsApp beat out its other free-messaging app competition. But the "mind-boggling earn out" is more about the business model -- network effects, exploiting incumbent blindspots, etc.

Agreed, not to mention Sequoia literally went and hunted the Founders down on foot in SF [1].

[1] https://youtu.be/8-pJa11YvCs?t=8m22s

Interesting video.

Brian Goetz mentioned that Sequoia built a tool they called "Early Bird" to help them keep track of messaging apps that show lots of traction in non-US app stores which was how they knew they really needed to get a Whatsapp deal, at any cost.

This is interesting; I've never come across job postings from VCs for their tooling/business line application development needs, but surely these roles must exist.

Yes, those roles do exist among top and aspiring top tier VCs, but VC being a people-oriented business means that Sequioa and other top tier VCs like a16z and YC [0] who build their own tools in-house should have no problem assembling a talented team of 1-3 engineers to write software by just reaching out to their network.

[0] https://blog.ycombinator.com/investor-day-software/

That's like something out of SV (HBO's show).

Great video.

Also didn't focus on US. I'd wager most Americans haven't heard of it. Seems relevant.

> I swear to God, WhatsApp is THE startup fairytale.

May I suggest a Black Swan as the main character for your fairytale? :)


> greenfield tech

how so?

We like startups here, so we pretend they didn't leverage ejabberd.

He has 6.5 BILLIONS. That's almost double what Brian Chesky (CEO Airbnb) has including paper money, more than Evan (CEO Snapchat) has, and more than Travis (CEO Uber) has including the ridiculous valuation. Just an observation.

That really is crazy. And Jam Koum has already cashed out at least half his stocks. Billions cashed out. The amount of money between those two guys is insane.

Similarly it's crazy to see how high up people like Moskovitz are in billionaire lists. I've gotten used to Facebook being a $400B company (now they are a $500B company), so obviously stock owners like Moskovitz will be worth tens of billions, but it's still crazy nonetheless. Just checked. He's ranked 60th richest.

I guess Jam Koum has been autoselling his vested stocks for a while since I often see his name on FB's insider activity list.

Much more than YouTube sold for, total acquisition price. Which I thought was incredible at the time (and still do, considering how difficult is has been for Google to monetize, it seems.)

I think WhatsApp was just overvalued, personally. It's excellent in many ways, but I cannot see Facebook ever making their money back on it.

Acquiring threatening social competitors may be, in part, a cost of doing Facebook's core business. That is: Facebook bought WhatsApp not because they expected to make money off the acquisition, but because they were worried that they'd lose money from not doing so.

Today I was sitting in a hotel lounge in Dubai and a lady asked me to help send her geolocation to her friend. She asked whether she can use my Whatsapp. I said I don't have Whatsapp, but I have Messenger abd Viber. She looked at me very bewildered and asked, "You don't have Whatsapp? Why would you use Messenger?" I explained to her that in Europe we use Messenger and Viber, not Whatsapp. She thought I'm crazy. In the end I gave her hotspot and she left me to my crazy Messengering.

Dunno where in Europe you're based but WhatsApp is the defacto messaging app in Irl & UK

Same in the Netherlands, Germany and Spain. I saw an article that in the Netherlands it apparently is installed on 90% of all smartphones. As far as I know, WhatsApp is pretty much the default in the EU with the exception of Scandinavian countries. Norway, Sweden, Finland are more often to be found on Messenger.

In much of the world, WhatsApp is the preferred way of communication, instead of Facebook/FBMessenger. I use WhatsApp for very personal conversations with friends and family - breakups happen over WhatsApp, dates planned, personal news are all communicated through WhatsApp. Tapping into these kind of messages which tell FB way more than likes on pictures etc is invaluable for selling ads in my opinion. Even considering E2E encryption, I don't believe FB is not analysing this data when they have the opportunity to do so - the text analysis probably happens on device.

Nobody has found it doing that, though. It could be something that will be added in the future of course (let's hope not...), but "could be" is not really interesting for the current situation. It ain't analysing your chats at this time.

I'm from an African country where Whatsapp has played a major role in the political uprising against autocratic governments. Its power to mobilize the masses to go on the streets and protest is incredible. Radios and TV stations couldn't do that due to the pressure and their fear of being shut down by authorities. But Authorities have found a way to mute Whatsapp: shutting down the Internet. Just search : "Internet or Whtasapp shut down in Cameroun, Gabon, DR Congo or Togo" to find out. We are currently looking for alternatives to Whatsapp messenger that can work even when the Net is down. Suggestions are welcome.

Same is happening in India. The government will shut down an entire area's mobile Internet just to prevent people from mobilizing.

I have no idea how well this works, but the Serval Project aims to let people communicate when the network is down:


mesh net, but they'll just bring the power down. maybe solar-powered with battery backup? but that gets expensive.

but hopefully coming down considerably. Watch this youtube vide of Tony Seba https://www.youtube.com/watch?v=2b3ttqYDwF0 (Stanford University futurist Tony Seba spent the last decades studying technological disruptions. He argues that the Electric Vehicle, battery storage, and solar power, along with autonomous vehicles, are a perfect example of a 10x exponential process which will wipe )

Yep! Mesh nets are great. Look up guifi.net, it's a large mesh net in Spain, for inspiration.

Solar panels are relatively cheap these days. Maybe you don't need battery backup.

The interesting thing about WhatsApp is that most of my American friends haven't heard about it by the time it was acquired for $19B. One of the biggest success stories of a US based company that went global first.

Good luck to Brian on his next adventure.

I'm guessing his stock has vested and he can now cash it out. Good on him, it was a nice success story selling for as much as they did to Facebook.

You know, not everyone wants to be at the same company for 8 years. The whole idea that if a co-founder leaves its a bad thing is antiquated.

After a while you want to do something different.

It's fine if they just want to do something different, but leaving isn't only seen as a reflection of their opinion of the post-accusation company. It still represents a brain drain regardless of motivation.

It still represents a brain drain regardless of motivation.

Not necessarily - and I'd say this is typical example of the Great-Man Myth. That role might be better served by someone other than a founder.

Jam Koum already cashed out in 2016: https://en.wikipedia.org/wiki/Jan_Koum

He cashed out half of his FB stock

shh... He wants to make a bitter comment, let him be

Who's making a bitter comment?

While I understand why the founder would leave at this point, WhatsApp is probably the platform with the most upside gain opportunity in existence today.

It has proved that a new paradigm of software development is ready to be opened up in the developing world, has small and big businesses knocking down the door to get in, and the highest daily active user base around. The only downside is how they've failed to scale to accomidate the opportunity.

But maybe they are right to go slow as they have network lock in.

What is this upside gain opportunity you speak of?

From my limited understanding - WhatsApp merely made free (or extremely cheap) texting possible, bypassing cellular providers who charged an arm and a leg for text messages. That's their contribution. Is there something else? What's this new paradigm of software development?

Micro-interfaces & payments being pushed via messaging. Tens of millions of businesses area already trying to hack it together via WhatsApp's existing features. For an existing example look at WeChat, which has limited application outside China but represents WhatsApp's future.

My only issue with whatsapp is how the data is stored in a central place. I am a person switching between ios and android and I have lost a lot of data. Plus even has issue in the same device after formatting.

I am not a big fan of having my mobile number as my identity as I keep moving around and change my mobile when I get a better package. I wanted an app that assign me a unique id and I can share in that my current mobile number where people can call me in.

Just yesterday, I was looking at a phone running all the various IM apps and whatsapp was the lowest with 18mb, IMO was 40mb while facebook was 100+ mb. not sure if it was the messenger alone or facebook + messenger.

Facebook doesn't seems to be interested in improving whatsapp.

Hope now WhatsApp start caring more about business and integrations. As basically the only option for communication software in Latin America, it feels a lot behind.

Whatsapp for business is already in beta trials in India. I'm sure they are ironing out the wrinkles before releasing it worldwide. I think probably end of this year or early next year.

Its a huge 'about to be tapped' market by FB that many people (mostly those who dont use WA) have a tough time fathoming.

Out of real curiosity, what business integrations would be at the top of your list?

Being able to pay someone, being able to command something out of the app. Being more like WeChat, literally.

That's almost 3 years (October 6th 2014) since FB's acquisition, social media would have been much different today had they acquired Snapchat.

New foundation, or maybe he finally got a job at Twitter?: https://twitter.com/brianacton/status/1895942068

(The backstory is: Brian Acton was rejected from Facebook and Twitter in 2009)

How will this affect their direction and approach as far as the end user is concerned?

Odd that this comment is collapsed by default, while the garbage comment below it is below 0, but expanded by default.

WhatsApp is so DEAD.

Off topic, but what's up with an 800 day old account with no submissions and only this as it's first comment?

Because, Facebook is ruining WhatsApp.

Facebook sells information of its users. And yet people are happily feeding their data.

Even WhatsApp's founders were not happy with the Facebook's policy. For them it was a mistakes that they became a product of Facebook.

Yes, I've a problem with that. Don't you think its legit?

It just seems like a strange first topic after 800 days in read-only mode

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