The Four Numbers That Remind Every Startup How To Become A Billion Dollar Company

Jan Koum, WhatsAppDavid Ramos/Getty ImagesWhatsApp cofounder Jan Koum

Ten months after its $US19 billion acquisition by Facebook, mobile messaging startup WhatsApp still has great lessons for startup founders who want to succeed.

Sequoia’s managing partner Mike Goguen explained why at the Wharton Entrepreneurs Summit in San Francisco on Wednesday.

He stressed the importance of finding a company that is “obsessively driven, metric focused, and fixated on thrilling customers.” WhatsApp is one of the few companies that had all the characteristics he described.

More important, WhatsApp did all this without spending a lot of money. It was the epitome of a lean startup.

Goguen brought up these four numbers to make that point: “450, 32, 1, 0.”

Here’s what he meant:

  • WhatsApp had 450 million monthly active users at the time of its acquisition.
  • It only hired 32 engineers to grow that fast.
  • It charged only $US1 per year to use its service.
  • Most important, it spent absolutely zero dollars on marketing.

Sequoia was the only investor in WhatsApp and it raked in about $US3 billion on the deal. You can read more about it in a blog post by Sequoia partner Jim Goetz.

Here’s a graph that shows WhatsApp’s insane growth:

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