Best Use Of Airline Miles Ever: Fueling $19 Billion Tech Deal

Posted: Feb 22 2014, 3:26pm CST | by , Updated: Feb 22 2014, 7:15pm CST, in News

 

Best Use Of Airline Miles Ever: Fueling $19 Billion Tech Deal
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How do you issue an ultimatum to Facebook chief executive Mark Zuckerberg in the midst of negotiations about a $19 billion tech deal? Credit Jan Koum, the founder of WhatsApp, with inventing a maneuver that isn’t in any of the standard M&A playbooks. It involves airline miles.

The full details are in a delightful post by Koum on flyertalk.com, a website that has been one of his favorites since 2009. (Credit a Quora.com participant with bringing Koum’s comments to a wider audience.) As Koum tells the story, it was important to him that Facebook’s proposed purchase of WhatsApp be fully wrapped up by late Wednesday, Feb. 19, so that it could be announced then.

How important? Well, Koum had already used his abundant collection of airline miles to snag a free ticket from California to Spain, so that he could speak at Mobile World Congress in Barcelona. Ticketing rules prohibited him from switching his travel dates. So, Koum says, he told Zuckerberg’s acquisition team that “if we don’t get it done on Wednesday, it probably won’t get done.”

Considering the size of the Facebook-WhatsApp deal — and the prospect that Koum’s 45% stake in WhatsApp would soon be worth more than $6 billion — it’s possible to imagine the typical CEO in such a situation absorbing the annoyance of a wasted airline ticket and being willing to pay for a new one if talks stretched out. But that’s not Koum’s style. He’s a Ukrainian immigrant who scraped by on food stamps early in his time in the United States, and he’s built WhatsApp on thrifty business principles, such as using personal frequent flyer miles to pay for business trips.

Credit Zuckerberg and his team with realizing when a founder’s travel-spending quirks should be taken with 100% seriousness. The Wednesday target date held firm.

Whether Koum will still cash in miles for business travel a year from now — by which time presumably the Facebook deal will have closed and he will be a very rich man — is anyone’s guess. But for now, at least, he’s proud to be among the bargain hunters at FlyerTalk. As he mentions in his posts, the site hasn’t just helped him get cheap tickets. It’s also connected him with frequent travelers in all walks of life, who have ended up being among the most enthusiastic users of WhatsApp’s messaging service.

Source: Forbes

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