Facebook Bought Gowalla’s Founders For ~ $3 Million In Shares

Josh Williams Gowalla CEO

[credit provider=”Joi via Flickr” url=”http://www.flickr.com/photos/joi/4737290853/sizes/z/in/photostream/”]

Last week news broke that Gowalla, a Foursquare competitor, was shutting down and its founders were joining Facebook.It sounded like a pretty bad deal for investors, but a few sources told TechCrunch’s Alexia Tsosis they happy with the decision.

Gowalla’s founders, she writes, were acqui-hired for about $3 million in Facebook shares

Investors understood that the founder, Josh Williams, was in a tough place against Foursquare. They  figured Facebook shares were more valuable than straight cash too.

Unfortunately for Gowalla’s management team, the deal probably means they didn’t fare very well. Gowalla had raised ~ $10.5 million in venture capital; most of the $3 million shares likely went to investors. “The team, many of which will not be moving on to Facebook, did not get a significantly better deal than investors I’m hearing,” writes Tsosis.

Investors Shervin Pishevar and Sean Parker both said they were happy with Gowalla’s move at LeWeb last week.