WhatsApp - Brian Acton & Jan Koum

Questions for them

• I've heard from several people that WhatsApp got lucky, and the evidence those people offered was the fact that there were numerous competing apps. It seems to me that these people just haven't looked closely enough at the differences between WhatsApp and its competitors. From my research, the major factors I identified were: 1) WhatsApp was out-of-the-gate near the start of when push notifications were released, 2) it was run by owners/cofounders instead of by people who were working for someone else (AIM, GTalk, Skype), 3) it was run by people who had serious experience in scaling systems, 4) it moved quickly to add new platforms. I imagine you have spent time thinking about this issue; do you agree that those factors were significant? Are there any other factors that jump to mind that I didn't mention?

• What do you think of these people (like the Snapchat founders) who are able to bootstrap to X number of users and then raise enough money to hire good engineers? It seems like it's very important to have good engineers, but that if you're able to find a good opportunity and raise money, that kind of talent is readily available: if you're willing to pay $X, you can be almost guaranteed engineers who will be able to solve that part of the puzzle of building a billion-dollar company. Whereas that doesn't seem to be true of choosing what to build; it doesn't seem like you can just pay $X and be guaranteed that you'll be working on the right thing. It seems to me that there may be more of a lack of knowledge in the Valley around 1) identifying these big opportunities and 2) getting early traction than there is around being able to exploit them once they show early promise. But I may  have an inaccurate view of the situation. What's your take on that topic?

• The articles suggest that Jan inadvertently created a messaging app, but he started creating the BlackBerry version of that app in may, one month before push notifications were released. Creating a version of the app for another OS would have been a big investment, like maybe $10,000 - $20,000. And there was a lot of press about the push notifications. It seems like jan may have seen this opportunity ahead of time to some extent. Can you shed any more light on this?

• What was the startup Brian had tried to get going? The fact that Brian didn't immediately start working with Jan suggests that they really didn't see the messaging opportunity ahead of time.

• My understanding is that there was an initial rush of users in the summer of 2009 that motivated you to join. At that time, it seems Jan had both a BlackBerry and iPhone version of the app out, and only those out (not Nokia, etc.). I'm guessing those versions of the app were set up so that you could send messages between them, is that right? Do you know what the rough make-up of iPhone vs. BlackBerry users those early users were? And since both the BlackBerry and iPhone already had free messaging services (BBM and iMessage), would you agree that those users were primarily motivated by the ability to do free messaging between BlackBerry and iPhone?

• Do you know roughly how many users WhatsApp had when it released the version that used push notifications to send messages? Was it under a hundred? Or several hundred? Or thousands?

• How much did Jan pay for the first version of the iPhone app and the first version of the BlackBerry app? What kind of retainer agreement did he have with the developers?

• IIRC an article said Jan got you to raise $250,000 from friends and former coworkers. I'm guessing that early money was for developer time and SMS fees. How did he arrive at that number in particular? How much runway were you guys aiming for?

• Do you think Apple had its hands tied w/r/t creating a push-notification messaging service for iOS 3 because of their close dealings with carriers (like AT&T)? Or do you think it just wasn't a priority for them / they overlooked the opportunity?

How you could have spotted the opportunity

• Look for things that lots of people are paying for, even if it's a small amount ($10-$20 per month).

• Look for "mediocre players who are tired and have a lot of chips", to use Tony Hsieh's phrase. The carriers were making a lot of money but were mediocre competitors.

• WhatsApp Blog

  • The first blog entry is August 8, 2009, just two months after push notifications were enabled, and only one month after the first version of WhatsApp to use push notifications.

  • From this blog post it seems that Jan was the one writing the blog entries: the command prompt entries start with "jkb@c123$", and I'm guessing jkb refers to Jan Koum. [Later: Also, this blog post, "Brian and I"]

  • 2012.06.18 - Why we don't sell ads

    • "At WhatsApp, our engineers spend all their time fixing bugs, adding new features and ironing out all the little intricacies in our task of bringing rich, affordable, reliable messaging to every phone in the world."

  • 2013.07.17 - iPhone v2.10.1 release notes

    • "As you know, we used to charge iPhone users a $.99 one time payment, while Android and other platforms had free service for the first year and paid $0.99 a year after that. From now on, we've simplified our business model so that all users on all platforms will enjoy their first year of WhatsApp service for free, and only pay $.99 per year after that. (...) The good news for all current iPhone users is that WhatsApp will be free of charge for the rest of your life."

• AppAnnie - WhatsApp

• Wikipedia - WhatsApp

• GrowthHackers - WhatsApp

Timeline of their success

• http://tess2.uspto.gov/bin/showfield?f=doc&state=4802:546dko.6.3

  • • If you go to Google Maps, it appears to be Jan's home address.

Articles about WhatsApp competitors ("Why did they lose?")

• AIM

  • 2009.06.22 - TC - Now We're Talking: AIM With Push Support Hits The App Store

    • Comments:

      • "The only problem I see with using AIM is that most people outside of America don't particularly use it. I'm hoping Skype picks up a little more around my area, because Skype on iPhone is such a glorious thing to behold."

  • 2009.06.30 - TidBits - AIM for iPhone Adds Push Notification

    • "The program comes in two versions: free with ads, or $2.99 without ads."

    • "Once you're signed in to AIM, the software lets you remain signed in for 24 hours"  ← That seems annoying, needing to sign in again every day.

    • 
       
      
       ← Pics of the interface

• BeejiveIM

• GTalk

• Skype

• Textfree

  • 2009.06.30 - AppAdvice - How To: Save Big On Text Messages

    • "Textfree Lite is limited to 15 messages a day; Textfree Unlimited is $5.99."

• TextPlus

  • 2009.06.04 - CNet - Send free text messages with TextPlus

    • "Lots of apps let you sidestep iPhone SMS to send and receive text messages for free. But in most cases the apps themselves cost at least a few bucks."

    • "free, ad-supported"

    • "Of course, the hassle with any third-party SMS app is that you don't get notifications of new messages unless the app is running. iPhone OS 3.0 promises to allow developers to remedy this problem, but for now the common workaround--and the one offered here--is getting new-message notifications via standard SMS.

      Needless to say, that's not an ideal solution, as you still incur SMS charges for those notifications. But that's par for the course with SMS apps, and you're still able to save on outbound messages.
      
      Until now, Textfree was my go-to app when my SMS count was nearing its monthly limit. But the freebie Lite version tops out at 20 messages per day, doesn't have a landscape keyboard, and doesn't do group messaging. Needless to say, TextPlus has replaced it."

• Windows Live Messenger

Articles about push notifications and texting fees prior to Jan/Feb of 2009, when Jan decided to create an app

• Generally relevant, no specific time

  • Wikipedia - Apple Push Notification Service

    • "Apple announced the service on June 9, 2008 with an original stated release for that September; however, as stated by Scott Forstall at the iOS 3.0 preview event on March 17, 2009, the rollout was delayed after a decision to restructure the APNs for scalability purposes due to the allegedly "overwhelming" response to the announcement of the APNs."

    • "It was first launched with iOS 3.0 on June 17, 2009."

  • Google Search - "push notifications" - 2006.01.01 - 2009.03.03

• Time-specific articles

  • 2008.06.09 - Ars Technica - Ars at WWDC ’08: Live keynote coverage here!

    • -Unified push notification service for all developers, preserves battery life, maintains performance
      -The push stuff scales to many third-party services, one persistent connection needed
      -We have come up with a far better solution, we are providing a push notification service to all developers

  • 2008.08.19 - CyberSurge.org - Apple Pulls Push Notification From 2.1 Beta 4 SDK

    • "Applications like AIM and Twitterrific are dieing for functionality like this since both of them would benefit greatly from being able to send notifications to its users."

  • 2008.09.13 - RobertSDonovan.com - iPhone status screen mock-up

    • 
       ← It specifically has an example of SMS being one of the push notifications.

  • 2008.11.25 - Gizmodo - Why Is Apple iPhone Push Notification Still Missing?

    • "As any BlackBerry user knows, push services allow the developer to implement functionality that is extremely useful. For example: An instant messenger program would be able to notify you whenever a new message is received, even while the application itself is not running. Think about it just like an SMS. Another example: A voice over IP application can receive a call and alert you right away, so you can pick it up like any normal telephone call. Or maybe return the call using the normal telephony service if you are not in a Wi-Fi spot.

      As you can imagine, this makes push notification a Holy Grail for users and developers alike. The only people who may not be happy about these are the carriers. After all, the idea of an instant messaging application with push notification services taking over their lucrative SMS business doesn't seem like a very good one."

  • 2008.12.28 - NYT - What Carriers Aren’t Eager to Tell You About Texting

    • "the 2.5 trillion sent messages this year, the estimate of the Gartner Group, is up 32 percent from 2007. Gartner expects 3.3 trillion messages to be sent in 2009"

    • "The most profitable plan for the carriers will be the one that collects the most revenue from the customer: unlimited messaging, for which AT&T and Sprint charge $20 a month and T-Mobile, $15."

  • 2009.01.28 - MacWorld - iPhone push notifications: dead and buried, or waiting in the wings?

  • 2009.01.28 - Ars Technica - iPhone push notifications: Apple needs to get them right

    • It is now nearly five months after Apple originally said it would release push notifications for the iPhone, a service that would allow third parties to send instant SMS-style alerts to their applications on the device.

    • The fundamental component of this push system is a single process that can run in the background of the iPhone OS and listen for notifications coming from the server, much like the Mail and SMS apps can listen for messages pushed in near real time. The system is designed to allow third-party applications and services to send notifications to an iPhone (such as when someone IMs you, or pings you on a social network), which would then be displayed in an SMS-like popup that allows the user to either act on the message (perhaps by opening an application) or dismiss them into some sort of a queue for taking action later.

  • 2009.04.09 - TidBits - When iPhone Pushes, Text Message Fees Fall

    • "Text messages cost phone companies nearly nothing to deliver, and yet messages are billed at rates a thousand times their actual expense. This has become well known, even as carriers in the United States have raised pay-as-you-go rates for SMS (Short Message Service) from 10 to 20 cents a pop in the last year. (Randall Stross explained it well in a New York Times column in December 2008.)"