Wales' richest man
will make millions from Facebook's £11 billion purchase of WhatsApp.
Facebook and its
founder Mark Zuckerberg have paid a staggering $19billion(£11.4bn) for
WhatsApp, the smartphone App that replaces expensive text messages.
It is a major coup
for the investment company, Sequoia Capital, which is run by British investment
guru, Michael Moritz, who is Wales’s richest man.
The Cardiff-born
venture capitalist chairs Sequoia, which invested $8million dollars in WhatsApp
in 2011 to build a stake which is now worth $3billion(£1.8bn).
The purchase by
Facebook makes clear the company is taking an aggressive approach to snap up
any thriving social media tech businesses which threaten its dominance.
Mr Zuckerberg
famously closed a $1 billion deal to buy photo-sharing service Instagram over a
weekend in mid-2012.
In a blog post,
Sequoia said the purchase was a 'spectacular milestone for the company's
co-founders Jan Koum and Brian Acton, and their remarkable team.
'For the past three
years, it’s been our privilege to work shoulder-to-shoulder with Jan and Brian
as their close business partner and investor.
'It’s been a
remarkable journey, and we could not be happier for these talented underdogs
whose unshakeable beliefs and maverick natures epitomize the spirit of Silicon
Valley.
'Those less familiar
with WhatsApp and its wonderful product will marvel at how a young company
could be so valuable. Many of those people will be in the US because there’s no
other home grown technology company that’s so widely loved overseas and so
under appreciated at home.
'WhatsApp reminds us
of other companies that we partnered with — like PayPal, and YouTube — whose
founders chose a similar path to Jan and Brian.
'Today PayPal and
YouTube are both household names around the world. Tomorrow the same will hold
true for WhatsApp.'
Meanwhile, the
creators of instant messaging service WhatsApp can now comfortably call
themselves billionaires after signing a $19 billion deal with Facebook.
But the duo's road to
becoming billionaires several times over has been filled with humble beginnings
and setbacks
Jan Koum, 37, who
co-founded the app with Brian Acton in 2009 co-founded WhatsApp in 2009, and
five years later, is now estimated to now be worth about $6.8 billion.
But at one point he
was a teenage immigrant who lived on food stamps.
The 'long
time'-friend of Facebook CEO Mark Zuckerberg was just 16 when he moved to the
U.S. from Ukraine.
He was raised in a
rural community, in a house with no hot water or electricity, and when the
family moved overseas, his mother packed their suitcases with school supplies
to save money.
As a young immigrant,
Koum and his mother had to rely on food stamps, and in a poignant tribute to
his humble past, he chose to sign the deal with Facebook at the same welfare
office in Mountain View where he used to queue to get food stamps.
The offices for
WhatsApp, an instant messaging service with 450million active users which Koum
created with Brian Acton in 2009, are located only a few blocks from the
welfare office.
On Wednesday, Acton
and Koum stood outside the welfare building as they signed the deal with
Facebook, only this time Koum was able to drive there in his Porsche.
His humble beginnings
appear to have instilled in him a strong work ethic and dislike for egotism -
WhatsApp may be a global phenomenon but it has no sign at its office.
'I can’t see a reason
for there being a sign. It’s an ego boost,' he told Forbes. 'We all know where
we work.'
Koum and Acton
developed WhatsApp in coffee shops and at their homes. It took just a few years
for the app to be worth billions of dollars.
Facebook has paid $12
billion in stock and $4 billion in cash for WhatsApp, and the founders and
employees will be granted $3 billion in restricted stock that will vest over
four years after the $19 billion deal closes.
CEO Mark Zuckerberg
announced the acquisition on his Facebook page, acknowledging his long-standing
friendship with Koum in particular.
'I've known Jan for a
long time, and I know that we both share the vision of making the world more
open and connected.
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