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What do you mean? This is just a fact.

The company existed to make a return for the owners. The owners exited with $16 billion. That was the motivation of the owners/employees, not $14 million in annual revenue.



The $14 million is what justifies the $16 billion.


I guess that is the argument anyway. FB also recorded it's estimate of the useful lifetime of the WhatsApp users it acquired as a finite intangible asset worth over $2 billion.

My point is that the transaction must be analyzed from the viewpoint of the owners (as that is what the poster I was responding to cared about, viz a viz total profit/revenue to Twitter). When you do that, WhatsApp cashed (well, assuming FB stock can be treated as cash) out more per employee than Twitter.


No, it doesn't. I strongly believe there are many other important factors like user base, growth ratio and active users than define the real value.


Sure, lots of other factors are important, but ultimately factors like user base growth and active users are just showing WhatsApp gaining a larger revenue stream.


No, the half billion plus user base, consisting almost entirely of non-Facebook users, is what justified that purchase to Facebook.


WhatsApp's revenue that they earned from that user base is what was driving the valuation from the perspective of everyone not in Facebook's camp. Facebook woukdnt have been able to buy WhatsApp if WhatsApp thought they could make more money off that username than Facebook.




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