Word is that Facebook is finalizing a deal to buy crowd-sourced navigation app Waze for a cool Billion.
If it comes to be, my initial reaction is: (1) that has to be one of the highest payouts ever (if not the highest) for an Israeli-based start-up; and (2) oh, no – Facebook please don’t wreck Waze, my favorite nav app; and (3) what privacy?!
Of course this is conjecture at this point. But if the deal happens, even for $800 million, which is the lower end of the rumored range, this is one heck of a sweet payday for Waze investors. From Zero to almost a Billion in valuation in just five short years would make this a historic event for the tech industry. Last year, according to PwC the average deal for an Israel-based startup was $110 million. That’s for 50 deals, with a total $5.5 billion in value, down from a high of $10 billion in 2006. Deals are down, but individual transactions are up.
Hopefully Facebook doesn’t wreck Waze. I love Waze. It’s one of a handful of app that brings me great joy everyday when I pop it open on my Nexus 4. Sounds ridiculous to say I know – that an app can tickle one’s fancy. But such emotion for an app is indicative of an engineering team that understands its users. Then there’s the community element. The idea that we’re all fighting traffic together, and helping each other daily (“we’re in this together!”) is an internet vibe that gives us all the warm-and-fuzzy. Think: Kickstarter.
Thankfully Facebook has a track record with mobile app acquisitions. With Instagram, it pretty much left the app untouched (a good thing) and made incremental improvements (people tagging). Though filters are now available in the native Facebook app for photo sharing I doubt we’ll see Instagram lose its unique identity. It would be foolhardy for Facebook to undo a successful, niche social network; in management’s eyes it’s yet another channel for mobile ads.
With Waze, Facebook will get to know us even better, like it or not.
Facebook already is the world’s largest database of personal information. We voluntarily tell others, and hence Facebook, where we live, what we eat, what we do. This is company that understands our preferences, our motives, our behaviors better than anyone (though Google comes close). So no they will know where we’re located ay any given moment. And where we’re headed. Some of this was available to Facebook already, via its (limited) Foursquare-like checkin functionality. But now this information will be dynamic.
Privacy concerns never slowed Facebook before. Truth be told, it doesn’t bother me too much – at least the idea that we’ll need to give up (at our discretion) some of our privacy to enjoy the benefits of technology. Going forward, with wearable computing and the emergence of even more pervasive, real-time, community-driven technologies, that’s likely not going to change anytime soon.
If Facebook does buy Waze, in the end I’ll likely be ambivalent. Last year I suggested Apple buy Waze. That would help them shore up their mapping challenges, and gain a social network (something Apple has had problems with in the past – witness ‘Ping’). On the other hand, with a Facebook purchase the app would likely remain platform agnostic (notably, for iOS and Android). That’s all well and good, but when it comes to the Waze app itself, my message to Mark & company:
Please, don’t wreck it.