Google Inc. (Nasdaq: GOOG) acquired Waze Ltd. for $1.3 billion. The acquisition of the Israeli navigation app and traffic report start-up will be completed after months of reports that Waze would be sold to either Google or Facebook Inc.
Ra'anana, Israel-based Waze has almost 50 million users. This is a big number for an Israeli company, which probably helped it to achieve the hoped-for exit.
Google has already made two acquisitions in Israel, and it has an office here, in contrast to Facebook, which closed most of the companies it acquired, including Israeli start-ups. Both previous Israeli acquisitions by Google were modest. Google acquired personalized Website gadget developer Labpixies for $25 million and interactive video-clip developer Quiksee for $10 million. Both acquisitions were in 2010.
Waze has developed one of the most popular navigation apps on the market. It offers apps for smartphones, tablets, and vehicle systems for navigating roads in Israel and in other countries. The information is about traffic congestion, police presence, road accidents, speed cameras, and road hazards collected by crowdsourcing from Waze's social network.
Waze was founded in 2009 and in October 2012, it announced a $30 million financing round from Horizons Ventures, Kleiner Perkins Caufield & Byers, and iFund. The company has raised $67 million to date from Magma Venture Partners, Vertex Venture Capital, Qualcomm Ventures, BlueRun Ventures, Microsoft Corporation (Nasdaq: MSFT), and the investors in its 2012 financing round.
The deal will turn some Waze founders into multimillionaires. CTO Ehud Shabtai will earn $78 million, president Uri Levine will earn $38 million, VP R&D Amir Shinar and his brother Gili will earn $65 million.