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Showing posts from February, 2014

WhyApp?

"Why? WHY?"  That's the question many people are asking themselves in the light of Facebook's historic $19B acquisition of instant message maker WhatsApp.  I must admit I was puzzled myself at the price tag, but found no shortage of Internet pundits (on Forbes and CNN Money , to name just two) willing to justify the cost based on a number of factors. Personally, I prefer quantifiable measurements.  And while my weapon of choice is typically financial metrics, such as NPV, IRR, and ROI, when it comes to M&A targets of this type where the primary driver is the size of the acquired company's user base, I switch to the advertising metric Cost per Thousand (users), or CPM for short.  ("M" is the Roman numeral for "thousand.") CPM rates are typically used for things such as online advertising and name list rentals (i.e. when you register on a website your information is rented to other companies who can specify that they want a pool of demog