Alright, let’s delve into the realm of WhatsApp’s revenue generation. WhatsApp, being one of the most widely used messaging apps globally, has managed to stay free for users.
However, it’s not all charity; there’s a method to the madness. In this article, we’ll explore how Meta, the brain behind WhatsApp, brings in cash through the app.
In the vast landscape of technology, certain names need no introduction due to their widespread popularity and utility.
WhatsApp stands tall in this category, boasting millions of active users every month. If you caught our recent piece on Telegram’s revenue model, you’ll find it interesting to compare it with WhatsApp’s approach.
So, without further ado, let’s unravel the revenue streams that keep WhatsApp in the green.
Table of Contents
History Of WhatsApp
The inception of WhatsApp dates back to the early part of 2009, brought to life by the minds of Jan Koum and Brian Acton.
Initially conceived as a status updater, the app earned its moniker ‘WhatsApp.’ Over time, it evolved into WhatsApp 2.0, transforming into the instant messaging app we know today.
In a significant turn of events, Mark Zuckerberg’s Facebook (now Meta) acquired WhatsApp for a staggering $19 billion in 2014, placing it under the expansive umbrella of Facebook.
Post-acquisition, Jan Koum assumed a role as one of the board members of Facebook. With over a billion active users worldwide, WhatsApp stands as a major player in the messaging app arena.
However, the intriguing question remains: How does WhatsApp rake in revenue, especially considering its free and ad-free nature, akin to its counterpart Telegram? Let’s uncover the financial mechanics behind WhatsApp’s success.
How WhatsApp Acquires Its Revenue
WhatsApp’s approach to revenue generation diverges from the conventional ad-centric model. Instead of inundating users with advertisements, WhatsApp sought alternative avenues to monetize its platform. The app’s inception aimed to resist incorporating ads, prioritizing a user-friendly experience.
Initial funding for WhatsApp amounted to $250 thousand, contributed by five individuals who now share ownership of the app.
Additional financial backing came in 2011 and 2013 when Sequoia Capital injected $60 million into the venture.
In the early days, the primary cost for WhatsApp was associated with the verification codes sent to users during the login process.
The pivotal source of revenue for WhatsApp materializes through the WhatsApp Business app. This specialized application serves as a conduit for businesses to engage with their customer base.
While businesses can integrate it with their websites, there’s a strategic limitation – companies can only respond to customers initiating contact to curtail spam messages.
WhatsApp extracts revenue from this business-focused app by imposing charges on businesses that fail to respond to customer queries promptly.
A fee is levied for each message sent beyond the designated response time. Additionally, businesses have the option to reply using their tools rather than exclusively through the WhatsApp Business interface.
WhatsApp has strategically ventured into the realm of Peer-to-Peer (P2P) payments, introducing this feature specifically for users in India.
This move not only aligns with the growing digital payment landscape in India but also positions WhatsApp as a prominent player in the country’s digital financial market.
The P2P payment option within WhatsApp has become a preferred choice for many Indians when transferring funds, serving as an additional revenue stream for the app.
So these are some ways through which the messaging giant WhatsApp makes its money. The app is also part of the Meta, which means funding would not be a problem.
We also have more WhatsApp tutorials. You can check out how to know if someone has saved your number and how to make new friends on WhatsApp.
Do you know you can message someone without having to store their number first? Click here to read how to message someone without saving the number first.
Do you know there are many strategies to make money on YouTube? click here to read our guide on making money online on YouTube.