Google’s Waze Acquisition in the Bag
It didn’t disclose how much it’s paid to close the deal, but the Israeli paper Globes put the price at $1.3 billion
Jun. 14, 2013 08:00 AM
Google made its much anticipated move Tuesday and pocketed Waze, the Israeli real-time traffic map maker.
It didn't disclose how much it's paid to close the deal, but the Israeli paper Globes put the price at $1.3 billion. Bloomberg put it at $1.1 billion. Either way it's reportedly cash money.
Google said in a short blog announcement that the "Waze product development team will remain in Israel and operate separately for now." Waze reportedly has 100 people in Israel.
Facebook tried to buy Waze for a reported $800 million to a billion dollars in cash and stock, but negotiations supposedly broke down when it insisted the Waze folks move to California.
The start-up has an office in Silicon Valley where it has a small staff and where its CEO Noam Bardin is located.
Bardin said in a blog posting on Waze's site that "Nothing practical will change here at Waze. We will maintain our community, brand, service and organization - the community hierarchy, responsibilities and processes will remain the same."
He suggested that it would either get bought by Google or IPO and "Choosing the path of an IPO often shifts attention to bankers, lawyers and the happiness of Wall Street, and we decided we'd rather spend our time with you, the Waze community. Google is committed to help us achieve our common goal and provide us with the independence and resources we need to succeed. We evaluated many options and believe Google is the best partner for Waze, our map editors, area managers, champs and nearly 50 million Wazers globally. Together, we can accelerate our mission to outsmart traffic. We will continue to make a real impact on drivers globally, helping them save time and money while making everyone's daily commute a bit more efficient and fun."
No mention was made of a possible regulatory review, especially since Bardin said recently that Google was Waze's only competitor.
Google snagging Waze keeps it away from Apple, which proved it needed help finding Paris on a map when it replaced Google Maps with its own last year.
It reportedly offered $500 million for Waze earlier this year. Why it didn't close the deal is a mystery since it seemed to need the hot property.
The expectation now is that Google Maps with be enhanced with some of the traffic update features provided by Waze and Waze will get Google's search capabilities.
It'll also get Google marketing muscle and money.
Waze uses crowd-sourcing to direct users away from traffic jams, construction sites, accidents, detours, police speed traps and cameras on both Android and the iPhone.
It has 50 million users, mostly in the US and Israel, up from 36 million six months ago and 10 million at the end of 201. It makes money from ads.
Google called its community of 70,000 spotters and map editors "the DNA of this app" and said it would "ensure they have what's needed to grow and prosper."
Waze raised $67 million since it started in '09 from Horizons Ventures (11%), Kleiner Perkins (4%), iFund, Magma Venture Partners (17%), Vertex Venture Capital (12%), Qualcomm Ventures (5%), BlueRun Ventures (19%) and Microsoft (10%). The ownership figures come from Globes which went through the files in Israel.