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Hey! Bill Ackman’s Pershing Square Holdings raised an estimated $1.4 billion in shares from selling a 2.7% stake in Universal Music Group. Despite Ackman’s calling UMG “one of the best businesses we have ever owned,” and still holding a sizable ownership stake in the company, the markets had a different response.

UMG’s stock dropped 9% following the announcement which comes on the heels of a down week for the entire. Some see the move as Ackman “making room” for future investors when UMG moves to a U.S. stock exchange, but time will tell how that all plays out.

​Today’s episode is about WhatsApp—a product that, ironically, has a lot in common with music! I’m joined by Tati Cirisano from MIDiA Research. You can listen to us here or read below for highlights.

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​Trapital Summit: Super Early Bird Tickets

Mark your calendar. On September 10, 2025, we’ll be at NeueHouse Hollywood in Los Angeles. We’re getting an early start given the heightened interest. We’re offering a super early bird discount that ends April 30.

Don’t be the person who scrolls through the highlights after the event and says, “Wow, looks amazing. Gotta be there next year.” This message is literally meant for you! Register here.​

The WhatsApp Opportunity and Challenge

I remember when I first heard about WhatsApp. It was this little app that I was first introduced to by my Jamaican relatives. WhatsApp was the answer to those crazy long-distance fees, overages, and excessive calling cards that drove up our monthly bills. I called AT&T plenty of times to negotiate those charges. I was often unsuccessful but hey, it was worth a shot!

What started as a simple messaging solution in 2009 quickly evolved into a global phenomenon. Within five years of its launch, Facebook acquired WhatsApp for $19 billion in 2014, recognizing its explosive growth trajectory. By 2016, it had reached 1 billion users, and by 2020, that number had doubled to 2 billion monthly active users, making it the most widely used messaging platform globally. Its growth in developing markets like India, Brazil, and across Africa has been particularly remarkable, with adoption rates exceeding 90% of smartphone users in many of these regions.

Over the years, slowly but surely, many of my group chats on other platforms like GroupMe, Telegram, or disjointed group texts have now moved to WhatsApp. Even some 1-on-1 chats with friends in the U.S. have moved onto WhatsApp. It’s the gateway for global communication and business.

WhatsApp is a product that:

• connects people worldwide across different cultures
• enables B2B users to build impressive businesses off of its platform
• is owned by a big tech company that values its ecosystem benefits over its standalone profits
• still struggles to monetize the cultural impact that it creates

Ironically, each of those bullet points can also apply to audio and video streaming. As the entertainment business knows too well, this is a powerful yet challenging position to be in.

Netflix, Spotify, and YouTube all faced similar challenges in monetizing massive user bases while maintaining product integrity. Streaming platforms gained power by prioritizing growth and their content libraries, just as WhatsApp focused on user experience and reliability. Netflix spent years perfecting its recommendation algorithm and user experience before scaling the service. Spotify has balanced the tandem of its free and premium tiers (much to the frustration of the rights holders who hate the free tier). Similarly, YouTube struggled for years before finding its advertising and YouTube Premium balance. WhatsApp now stands at a similar juncture.

For decades, Meta’s playbook has been to first grow a massive user base and then figure out how to make money. I’m old enough to remember when “Can Facebook make money off of mobile?” was a real concern that many had.

WhatsApp has accomplished the ‘massive user base’ with over 2 billion monthly active users. Today, it makes money from its business users through its WhatsApp Business API, click-to-message ads that integrate with Facebook and Instagram, and WhatsApp Pay. Those are just a fraction of its users.

The Business API has its success stories. Take Vodafone, which deployed WhatsApp Business to manage customer inquiries and reduced call center volumes by 30%. Delivery service Glovo uses WhatsApp to coordinate with its delivery partners, improving efficiency by 25%. Indian e-commerce platform Flipkart leverages WhatsApp for customer support, handling over 60% of its customer queries through the platform. These companies are willing to pay WhatsApp for tools that improve their customer engagement and operational efficiency.

In late 2023, WhatsApp introduced “Flows,” an in-chat browsing experience that allows businesses to offer high-quality menu interfaces. Then in 2024, WhatsApp Pay expanded to more markets thanks to AI-powered business assistants that can handle routine customer inquiries. AI has huge potential to save WhatsApp and its business customers a ton of money.

But what about the rest of its 2 billion users? The pain point is that people don’t want to see ads in the middle of their text messages or group chats! Texting is too active and personal of a consumer behavior habit for ads to be seamlessly integrated. Plus, WhatsApp value prop is that its data is encrypted, so Meta can’t target WhatsApp ads specific to us beyond what it can infer from metadata. Plus, even if WhatsApp wasn’t encrypted, text-based social media advertising has always been tough. Brands have less assurance on what type of content their ads will be next to.

Even if WhatsApp releases the right mix of revenue features, its impact in the Meta family of apps may far outweigh the benefit it offers to the company’s P&L. Like Apple’s iMessage, Google’s GMail, or various content streaming products, its value within the parent company ecosystem may be strong enough.

Something that Tati and I have talked about in several episodes is how most social networks have become more entertainment platforms. They may have begun as ways to connect with your friends, but the pivot to personalized feeds of entertainment was a far more lucrative journey.

WhatsApp is one of the rare platforms that is actually “social” in the traditional sense. The path to further monetization though, is full of opportunities that would change the fabric of the product.

The “Facebook” or “Instagram” route of ad-based monetization for consumers would likely struggle at mass, but finding more ways to serve its power users, whether they’re B2B or B2C. Is likely the way to go. Enhanced storage? Advanced group messaging? They could all be on the table.

Parts of it sound a lot like the superfan strategy in music. The power users are the path to monetization on many platforms. Let’s hope the value prop is a little stronger than what we’ve seen in music.​

Listen here:
​Spotify​ | ​Apple Podcasts​ | ​Overcast​

CHARTMETRIC STAT OF THE WEEK - "MILLENNIAL T. SWIFT?"

Last week, one of my wife’s younger co-workers asked her if Lady Gaga was her generation’s Taylor Swift. It’s a wild comment to hear about women who are three years apart in age, but I get it. Lady Gaga’s commercial prime was nearly 15 years ago.

But over the past month during her promo run for her new album, Mayhem, Gaga’s TikTok following has grown from 11 million to nearly 15 million. Even the new generation is tuning in.

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Dan Runcie
Founder of Trapital

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