In his first speaking engagement ever, at tonight’s StartX event, WhatsApp co-founder Brian Acton talked about the company’s big “F” word (focus), how people in the U.S. just didn’t get the service when it first launched five years ago, and, of course, its record-setting acquisition by Facebook (Acton said that WhatsApp will not be “swallowed by the Borg” after the deal is finalized). He also divulged that WhatsApp will finally offer a voice-calling service this year, which competitors like Line, WeChat, Viber, and KakaoTalk already do. Read on for excerpts from Acton’s talk.
On being acquired by Facebook for $19 billion
“I am a new father and in some ways being a father overshadows it, to be brutally honest. How did I feel? It hasn’t closed yet. I’ll say that when it closes there will be a sense of relief because between announcing and closing there are any number of months.
More than anything you are somewhat numb and dumbstruck. There are a flotilla of lawyers around you, 96 hours of being in a conference room with lawyers non-stop. By the end of it, it’s just hazy. You are just numb and trying to grasp it all and I don’t think I really grasp it all just yet. It will hit me in stages. I’m looking forward to it, but also with some apprehension.
I think this is pretty well-documented, but [Mark Zuckerberg] spent time with Jan at Esther’s German Bakery on San Antonio Road. It got really real in early February when he put a number in front of us and we were like ‘Oh shit, we got to pay attention to this.'”
On why WhatsApp agreed to be acquired by Facebook instead of going public
“Going public is 18 month process, while an acquisition is a 6 month process. Going public means going under so much scrutiny, regulatory approval, auditing, magnified 10 times. Having the stomach to do that isn’t necessarily in my DNA. My DNA is building a product and a service. Mark gave us an opportunity to do that.”
How WhatsApp will protect users’ privacy now that it is under Facebook’s umbrella
“One of the best aspects of the deal is that Jan and Mark have agreed to a model of independence in how Facebook will own and operate WhatsApp. We said it publicly, it’s business as usual. We are not going to on day one start sending data to Facebook. By the way, we don’t have any data. People don’t understand this–we don’t have much beyond a phone number to work with.
You sign up with a telephone number and go. You might have a notification name, but there is not a lot of data to share to start with. When people get concerned about data sharing, to start with there’s not a lot of data to share with Facebook. There’s the idea that we go crawling through messages–no. We don’t have the bandwidth to do that. We are 30 engineers, 60 people total. For us to go and skulk around people’s messages in 40 different languages, there’s no value for us.
It goes back to the utility concept. In Asia, some sentimental differences manifest. In Line, there is some cute iconography in the product, characters, entities called stickers. It feels very Asian when you use it. What we try to do is build something more universal for a broad base around the world. It’s worked for us in the Middle East, Latin America, South America. It’s hurt us a little bit in Asia, but Hong Kong and Singapore have been the best countries for us in Asia, so it has also helped us there.”
On setting the bar for high valuations
“There’s a certain degree of speculation that goes into valuations. In so far as the market supports a valuation, everyone who gets a great one deserves it, but they should also be cautious because that speculation is temporary. I saw Yahoo go from $100 billion to $10 billion. It’s not a long-term measure. Companies that have been built and operated for a long time are the most successful companies.”
On explaining and justifying WhatsApp when it first launched five years ago
“I worked several years for free and had the hardest time explaining to people in the United States. If you look at what our products is, it resonated earliest in Europe. WhatsApp provides phone number based messaging and people asked isn’t that what SMS is? Yes, but SMS is expensive, antiquated, and what WhatsApp did was modernize and level that playing field.
For example, in Europe, if France wants to talk to Belgium, it’s extraordinary costly because of border and telecom charges. It’s like asking North Carolina to talk to South Carolina. In the U.S. people asked ‘why not just keep using SMS,’ but people in Europe were like ‘I can talk to friends in Switzerland, in Belgium?’
It picked up super fast in Europe and then spread out virally through there. Eventually we figured it out and then it started taking off in the U.S. We do have more competition. Facebook has a messenger product as well, but we are also different. Facebook Messenger is built on the Facebook graph, but we are built on the phone graph, so we are complementary to each other as well.”
On avoiding an API or platform play
“I wouldn’t say we have completely excluded an API or platform play. We de-prioritized it. We really focused being the big ‘f’ word for us, building a great consumer experience to start with. We have people knocking on our door to say that we want an API, but with an API can come spam and we are very cautious about introducing a third party into the system. We don’t want people to uninstall WhatsApp because you suddenly start getting messages about low fares to Hawaii or something. We want to put that well into the future.
It’s hard because the world is a very diverse place and providing a good messaging service in Africa is very different than providing a good messaging service in the U.S.
WeChat and Line provide very diverse services, ranging from the Snoop robot on Line. That gets back to gimmickery. Who wants a Snoop robot to talk to? It’s fun for 30 seconds, and then you are done with it.
What we think about is voice. We will build it and plan to roll it out, plus users asked for it and we believe it’s useful. But a hookup service, finding friends nearby, those are not exactly the most useful things in the world.”
Photo courtesy StartX Media