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The Collapse of Social Media Companies in the US – From Within

The Collapse of Social Media Companies in the US - From Within (article or video, second draft)

Jan Koum, one of the co-founders of WhatsApp, wrote in 2014 about growing up in the Soviet Union and his constant fear of being monitored and watched by the KGB (now the FSB), the Soviet secret service that managed over 500,000 officers and informants at its height in the 1980s. Mr Koum seemed to be concerned about privacy as a result and when he started WhatsApp just over 10 years ago he had no idea that in the post 2016 US election he experiencing allegations of Russian interference from Moscow`s secret services. Keep in mind that Vladimir Putin is leader-for-life in Russia and  his first career was an officer in the KGB. 

When you couple this reality with the chain of events that seem to flow out of a movie script, it becomes bigger-than-life news. Mr Jan Koum who said earlier this year that he was “moving on” from Facebook, is now being joined by other senior managers who came over as part of the WhatsApp transaction. They continue to leave one-by-one.  Note he was a key member in the $19 billion dollar, largest-ever acquisition by Facebook. Sources point out that the movement of management does have its roots in data targeting, encryption, ad-based revenue and mobile payments. 

Koum left Facebook about two months after fellow WhatsApp co-founder Brian Acton told his followers to delete Facebook`s app. Acton left Facebook to help launch a new entity, Signal Foundation, which supports a secure messaging service called Signal. Apparently, Kuo sold almost $2.83 billion in shares in 2017, far more that what is usual by tech executives, raising eyebrows. The thing that we find most interesting is that although the founders of WhatsApp made billions when they sold their firm to Facebook gave up even millions more by leaving the Facebook on what is clearly differences of opinion regarding client interaction. Clearly there is a difference in opinion regarding client information and its usage.

According to WhatsApp co-founder Brian Acton, he walked away from $850 million dollars over users privacy and apparent disagreements over how to monetize WhatsApp. It seems that Mr Acton disagreed with targeting ads and selling business analytics tools. He claims he sold his company, and sold the privacy of his users – a decision he lives with every day. 

We at Classiarius feel that Facebook is just the beginning of what could be a fracturing of many social media companies – others are now seeing an exodus of staff who, sometimes for political reasons, or freedom of speech, are walking away to start new firms. Perhaps becoming competitors.


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