WhatsApp and the software that is eating the world
How WhatsApp acquisition changes everything, even for the Brazilian startups.
“Software is eating the world”. I always use this quote to explain the context which Engarte, my startup, is in. Billion-dollar acquisitions popped out in the past years and are challenging the economics and reshaping the dynamics on tech daily. But the WhatsApp and Facebook deal is in an entire new level. A startup that hasn’t found out how to make money yet be acquired by 19 billion dollars changes everything. Even for the ones in Brazil, my country.
When Facebook acquired Instagram, bubble talk become trendy again. Time has passed and now everybody started to agree that Instagram is worth much more. After that, more and more acquisitions followed.
Now, with the WhatsApp acquisition, Facebook sends a scathing message to the market: billion-dollar acquisitions aren’t bubbles, but the new way to expand businesses. More important, the founders of WhatsApp showed how to scale a startup and why you should not focus on early monetization.
Try to profit early and then achieve it is one of the worse threats to your exponential growth. Manage billing and customers isn’t a scalable task as growing and engage a community. So when you start this way, you close your eyes for the most important thing that you should aim when building a startup: generate value for your audience. Before they pay, preferable. This is why startups should get investment to begin with! For not need to worry about money. Do your thing, grow your business and be relevant.
The Brazilian Ecosystem
WhatsApp made another favor to the Brazilian ecosystem. As it became mainstream, a lot of people bought a smartphone only to use it. But when in hold of a device, they start to use all other apps that are available. 2013 was the year that we saw smartphones becomes mainstream here.
The way WhatsApp scaled, growing in relevance before growing in revenue is an approach that should be copied by us. And for the ones that might think that this doesn’t work for us, remember that Waze is an Israeli startup. And this didn’t work for them either, until they were bought by Google.
Join the discussion on Hackernews:
https://news.ycombinator.com/item?id=7271076
