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The WhatsApp sale and the $19 billion cost of anti-Semitism

Capture from WhatsApp.com homepage
Capture from WhatsApp.com homepageCapture from WhatsApp.com homepage

The ranks of the world’s Jewish billionaires grew by one this past week, as 37-year-old Jan Koum – who once worked as a grocery-store janitor – personally pocketed roughly $6.8 billion on the sale of the company he co-founded, WhatsApp, to Facebook for $19 billion.

Koum’s story is more than just a rags-to-riches fantasy. It is yet again a reminder to anti-Semites and would-be anti-Semites around the globe of the high price of hating the Jews.

Koum was raised in Ukraine, which remained rife with anti-Semitism long after the end of World War II and the collapse of the Soviet Union. His parents and grandmother all sought to immigrate to the United States to avoid the continual harassment of the microscopic Ukrainian Jewish community.

Life was hard for the Koum family. Jan’s father, who planned to join his relatives in the United States, died before he managed to depart. Then, soon after arriving in America, Jan’s mother was diagnosed with cancer.

The Koums subsisted off of food stamps, living in government-assisted housing in California. In 2000, when he was still only in his early twenties, his mother passed away.

Jan was a bright and self-motivated young man. He taught himself computer programming, relying on texts he found at a used bookstore. At the time, he couldn’t yet afford a computer of his own.

Eventually, Jan was hired by Ernst & Young and then Yahoo!. He applied to work at Facebook, but – ironically – was turned down.

Jan later designed WhatsApp as an automatic SMS-response service, letting people who send text messages know whether the intended recipient was available to immediately reply. WhatsApp quickly evolved to become an SMS service in its own right, popular for letting users bypass the costly fees typically associated with international text messaging.

Founded in 2009, and aided by venture capital, WhatsApp and its 55 employees built a user base that now numbers 450 million people worldwide.

Even while Jan was inking his arrangement with Facebook and its founder, Mark Zuckerberg – both of whom will now serve on the Facebook board of directors – his nation of birth was burning.

The recent strife in Kiev, Ukraine - which killed more than 100 people, injured hundreds of others, and sent the nation's president fleeing - can be traced to many issues, with economic progress (or the lack thereof) one central tinderbox.

Ukraine is a country of nearly 46 million people. In 2012, the entire nation’s gross domestic product was less than ten times what Facebook paid Jan Koum for his tiny company. Indeed, Ukraine’s GDP per capita is less than half of Botswana’s.

So what is the price that Ukraine, and other historically anti-Semitic countries have paid for the maltreatment of their Jewish sons and daughters?

In his November 2012 address at JEWISHcolorado’s Men’s Event, billionaire philanthropist Michael Milken noted the flight of so-called “Human Capital” from oppressive, economically restrictive, anti-Semitic nations.

As Milken noted, founders of five of the six largest media conglomerates in the world (the companies that eventually became 21st Century Fox, Comcast, Sony Corp. of America, Time Warner, and Viacom) were all born within 500 miles of Warsaw, Poland - but fled to the United States because of anti-Jewish sentiment.

Other Jewish technological gurus who are refugees from the former-Soviet Union include Max Levchin, co-founder of PayPal, and Sergey Brin, co-founder of Google.

What if Ukraine had welcomed, protected and supported its Jewish citizens? Might Jan Koum and other very wealthy Ukrainian émigrés have kept their job-generating companies and mounting wealth in the Eastern European nation?

Instead of internal bloodshed, might Ukraine be awash in incubator businesses and venture capital – much like Israel is today?

Yes, indeed. The Jewish people have paid a high price for anti-Semitism. But they are not alone.