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Writer's pictureFahad H

What’s The Most Expensive (Per User) Acquisition? Hint: Not WhatsApp

Last week when Facebook made its jaw-dropping $19 billion announcement that it was buying messenger WhatsApp many people, including me, marveled at the astonishing figure. But almost immediately others said, “Facebook got a deal; WhatsApp was actually cheap.”

I certainly wouldn’t go that far but by some measures WhatsApp (even at $19 billion) is not the most expensive startup acquisition in memory. If one considers the price per user, WhatsApp does emerge as a relative bargain.

This morning, I was pointed to a chart, based on public/third party data, created by Brightside that compares acquisitions on a per-user valuation. This is one of several such comparisons I’ve seen in the wake of the WhatsApp announcement.

The chart is too large to fully include but below, I’ve captured a few of the more prominent acquisitions and their per-user prices:

  1. GeoCities (by Yahoo): $830.23

  2. Aardvark (by Google) $555.56

  3. Mapquest (by AOL): $297.30

  4. Jaiku (by Google): $240

  5. Feedburner (by Google): $232.56

  6. Zappos (by Amazon): $206.22

  7. Delicious (by Yahoo): $150

  8. Flickr (by Yahoo): $111.11

  9. WhatsApp (by Facebook): $35.56

  10. Instagram (by Facebook): $28.57

What’s interesting about the list above is that many of the services are shuttered, suggesting that the acquisitions and their high per-user costs may have been wasted. Indeed, the now-defunct GeoCities property was the most expensive according to the data reflected on the Brightside graphic.

What’s your reaction? Do you believe that WhatsApp is a bargain on a per-user basis vs. the others, and is that the right metric to evaluate the deal?

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