In February of 2014, Facebook announced it would purchase WhatsApp for $19 billion in cash and stock. Once a heralded Unicorn itself, the mighty hunter took another as its prize. Sequoia Capital, the primary investor declared that WhatsApp co-founders have created the “communications backbone” of the Internet. With less than $60 million in private funding, the 4-year-old instant messaging company made its 50 employees rich, and newly augmented with the massive resources of Facebook.

How did a small mobile startup suddenly become the communications backbone of the Internet? Is there a method to the madness of these Unicorn valuations or are they just the fevered dreams of CEOs and investors? And how can older incumbents adapt to a landscape of young giants swinging their weight around?

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