The WhatsApp acquisition
The water-cooler was abuzz this morning with news of Facebook’s $19 billion acquisition of WhatsApp, a tiny company. With the claimed 400 million users that WhatsApp brings to Facebook, the numbers involve value each user at $40. That is an astonishing amount of money for a service that is monetised through application sales, not via advertisement. There have been a number of articles and blog posts online analysing this deal. This is not one of them..
My colleagues are a quiet and taciturn lot. Office banter is limited to a “Good Morning” and a “See you later..” outside of the lunch hour. For the first time, in my admittedly short stint here, we had a bonafide conversation that was not even tangentially related to trading systems and market data feeds. We got talking about what it means to be a programmer working outside of the startup / silicon valley scene. One of my colleagues remarked that he spent half a decade in further education and a lot longer learning the ropes until he got to the point now where he is comfortable and financially secure. He wondered if that time would have been better spent writing a new chat or social network. Perhaps a new way of optimising the transmission and sharing of ribald jokes, or for improving the sexting workflow.
We carried on in a similar vein for a while when the most introverted of our lot spoke up. He said: “I was just never interested. The thought of building the next Facebook or Twitter just doesn’t excite me. It was never something that was on my radar.”
I spend way too much time on Hacker News. The Silicon Valley culture and eco-system fascinates me, but it does not inspire me. I marvel at the numbers that are thrown around. A few billion here, a few billion there, but I also wonder about the utility of it all. It is now fashionable to talk about how much of a talent drain banking has become. How so many people left promising careers in academia and engineering to cut code and make money on Wall Street and the City. In a few years I can see people talking in similar terms about Silicon Valley. “He was a promising scientist, but he joined Google to help them optimise the placement of adverts on search results.”
I find the earnest tone of discussions on Hacker News and of the job postings for these start ups deeply ironic. They talk about changing the world, wanting rockstars and working on cool new technologies. Yet, the end goal is a big payout via IPO or acquisition having built a better way of sharing food selfies. I think these headline acquisitions are a honey trap for programmers. Somebody, like my colleague, who wouldn’t really even think about working for a startup building a “trivial” app might realise that the App may be a gateway to that long dreamt of retirement on the beach.. You might get a lot more people ready to work for peanuts with the hope of striking it rich one day. Perhaps it is not a colossal waste of money after all..