The $6.8 Billion Man: Poverty to Rich

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The $6.8 Billion Man: WhatsApp CEO's Path from Poverty to Riches

Tech luminaries are often drawn from the ranks of the already affluent. Mark Zuckerberg was the son of an upper-middle-class dentist. Bill Gates was technically a millionaire before he even started Microsoft in 1975. Larry Page's parents were both professors; Sergey Brin's father was a professor and his mother was a NASA researcher.

Yet occasionally, actual rags to riches stories emerge. Biz Stone, a Twitter co-founder, was raised on food stamps and received bowl haircuts from his mother to save money. Christian Gheorghe, now the CEO of Tidemark, came to the U.S. from Romania without speaking a word of English and initially found work as a limo driver.

But Jan Koum's story may be the most dramatic yet. Until Facebook's $16 billion acquisition on Wednesday, little was known about the WhatsApp CEO. The sudden intense interest prompted Forbes and Wired to rush out profiles of Koum that shed new light on his tale of ascendance.

Growing Up in the Ukraine

As Forbes recounts, Koum was raised in a small village outside of Kiev, Ukraine, in a house with no hot water. His parents also rarely used their phones, out of fear that the government was listening in. That suspicion of government power and the corresponding appreciation for privacy apparently runs deep in Koum's veins: Throughout WhatsApp's history, he has been protective of users' privacy and opposed integrating advertising into the app.

Though Koum said to Forbes he still pines for the rural life, he told Wired that life was rough: "It was so run-down that our school didn't even have an inside bathroom," he said. "Imagine the Ukrainian winter, -20°C, where little kids have to stroll across the parking lot to use the bathroom. Society was extremely closed off: you can read 1984, but living there was experiencing it."

Prompted by the unstable political environment — students were regularly questioned for mocking politicians in class — and increasing anti-Semitism in the Ukraine, Koum and his mother moved to Mountain View, Calif., when he was 16. Short on cash, the two stayed in a modest two-bedroom apartment on government assistance. Koum's father, who died in 1997, never made it to Mountain View. Koum's mother worked as a babysitter to make ends meet while he swept the floor of a grocery store. Later, when his mother was diagnosed with cancer, they lived off her disability payments. (Koum's mother died in 2000.)

An indifferent student Koum, who didn't have a computer until age 19, taught himself computer networking from a manual he bought at a used bookstore and later returned. Koum attended San Jose State University and worked part-time as a security tester for accounting firm Ernst & Young. Part of the work involved inspecting Yahoo's advertising system, a task that prompted Koum to cross paths with Brian Acton, who was employee No. 44 at Yahoo.

Acton, a computer science graduate from Stanford University, grew up playing golf in Florida. At one point, Acton's father attempted a career as a professional golfer. His mother founded an air freight business

Life After Yahoo

Koum spent nine years at Yahoo, a tenure that appears to be marked by increasing alienation from his work. “Dealing with ads is depressing,” he told Forbes. On Oct. 31, 2007, with $400,000 in the bank, Koum took some time off to decompress and travel around South America and play ultimate frisbee with Acton, who had also left the same day.

For the next year or so, it seems Koum didn't do much. Then in 2009, he bought an iPhone and, as legend has it, developed the idea for WhatsApp after growing frustrated with his gym's no-cellphone-calls policy. Another impetus was Skype: In the summer of 2008, Koum grew frustrated with that service after he forgot his password several times. He was determined to create an app that worked seamlessly on one's iPhone by using a phone number for identification.

By the fall, WhatsApp was still going nowhere, but Koum persuaded Acton to join him. At the time, both had been turned down for jobs at Facebook. Acton was also rebuffed by Twitter.

Around that time, the founders got a small group of former Yahoo employees to pool $250,000 in seed money. Early days were the stuff of startup legend. The company leased space in the same building as Evernote, which later took over the whole space and kicked them out. The office furniture was cheap stuff from IKEA and employees wore blankets when it got cold.

In early 2010, WhatsApp was bringing in about $5,000 a month. Things steadily improved until the company's breakthrough year, 2011, when WhatsApp hit the top 20 in Apple's App Store.

Now, thanks to a huge deal with Facebook, Koum and Acton are richer than their wildest dreams. (Forbes estimates Koum's wealth at $6.8 billion.) Yet Koum hasn't forgotten his roots. On Wednesday, when he signed the deal with Facebook, he chose a very meaningful location for the ceremonial act: the former North County Social Services building where Koum once stood in line for food stamps. To make the moment even more significant, while Koum was signing the documents, violence was erupting in his home country as protesters clashed in Kiev with President Viktor Yanukovych over the direction of the country.