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What Really Happened When Facebook Bought Instagram
- saddino 13y agoWhat I really enjoy about Kara Swisher's article is how her writing style and her framing of the story reflects the whirlwind reality that found Systrom and Krieger in an 18 month exit. There are no superhuman heroics involved here nor supersecret backroom deals. This is really just a simple story of good luck and timing, a spot on pivot and execution, and honestly brokered business relationships. You can't duplicate the Instagram strategy because there was no strategy. These guys didn't build an app to flip. They built an app that was cool: to them, their friends, their investors, their users, and ultimately their suitors and acquirer. Kudos to them.
- sooperman 13y ago... and a story that will continue to inspire product maniacs for a long long time to come.
- rhizome 13y agoThat's the irony!
- gbog 13y ago> writing style I beg to differ, I yawned on the first page, on the second page, and got somewhere else. Information density is very low. It looks like this journalist, as many other, is paid by the line, and adds too much water in the soup.
- Skibb 13y agoIndeed, writing is vapid at best.
- kmfrk 13y agoVapid is too strong a word, but it nothing but glorifies successful start-ups, and provides no caution for people who'd like to learn something from this. The only conflict described is agonizing over which multi-gazillion offer to take(!). It's also fairly thin on new insights into the history and acquisition.
- subsystem 13y agoI think it has to do with the intended audience and the format of the publication, more than anything else.
- Skibb 13y agoAlso, vapid according to dictionary: Offering nothing that is stimulating or challenging. Guess you're right. It was challenging to read the whole thing till the end.
- Skibb 13y agoWell it IS Vanity Fair after all.
- joezydeco 13y agoWe also have to collectively agree to stop using the term "money shot" except when producing or filming a pornographic movie.
- digitalengineer 13y agoA good read, for sure. As someone outside of the US, it makes me wonder if Instagram's succes would have been possible if it was a non-US company, or even a startup outside of California?
- crimsonzagar 13y agoDirect answer: no. Indirect answer: no. The probability is low because guys outside of bay area don't build app to dent anything. They don't aim to build an app that is cool: to them, their friends, their investors, their users, and ultimately their suitors and acquirer. They build it to mint money, which is why this story inspires them too.
- dualogy 13y agoSuuure, everyone outside the valley builds apps only for "money minting", not for "cool to everyone". Nice Cali bubble you live in ;D
- deleted 13y ago[deleted]
- crimsonzagar 13y agoEven if an individual tries to do it for coolness, and is passionate about it, the rest of the guys around him are not. And that can be a significant cultural influence. You're living in a bubble, if you can't see that.
- omegant 13y agoIt also counts that you are in a habitat where having beers with Zuck or being one of the first employees of google or twitter( or just name one..) is easy. If you need a 500000$ seed investment? No problem, I will talk to Andressen and it'll be done in a week.. Of course it's not always like this but SV is the place where this may happen. The biggest difference I notice with other places beyond the easier access to investment (I am from Spain), is that people there has a "can do" attitude that is almost completely missing everywhere else. If you go to Stanford, it is expected from you to go and make something big just because of that. Also there is the glorification of failure as a learning experience. Here in Spain I am seeing lots of good Ideas to start a small bussines or a Start up for almost no money, but even in the middle of the crisis, people who doesn't have a job gives me a blank stare every time I talk about them. They'll just keep looking for a simple job at a big company, as it that is the only possible way. The think that most impacts me of this article is how they get 25000 users the first day. How do you do that?. Is due to having a huge net of early adopters as friends? Edit: twitter spelling!(tweeter...)
- chankey_pathak 13y agoThey killed it!
- EGreg 13y agoI think this story also shows how super-important connections can be. This guy was well connected in the valley. The question is, how can someone who moves there from, say, New York, actually make those connections?
- pathy 13y agoMy guess would be that it is harder, especially to get connections like Zuckerberg, if nothing else because he, and others like him, are now quite hard to reach. That said, getting to know the up-and-coming Valley entrepreneurs should be doable. It is not as easy as getting to know them while you are in college but go to conventions, go to coffee shops, bars. If that is not your thing, start conversations on HN, Twitter, professional communities etc. One important thing to remember, people love to talk about themselves and their business. Especially entrepreneurs. On a personal level, I am finishing up my Masters (in Amsterdam - so no where close to 'The Valley') and I really feel that I should have done more networking. It is not that hard to get to know people if you make an effort but I have been way too comfortable with my group(s)of friends.
- mailshanx 13y agoBut doesn't a huge part of the problem stem from geography? Like you, i'm finishing up my Masters in Singapore - that is pretty much on the opposite side of the globe as SV. Surely i can't afford to go flying around to SV conferences as a student. I'll be speaking at a few conferences in Europe this summer, but still, i feel that if you are not located at least in the USA, you are missing out on a huge piece of startup action...
- pathy 13y agoThat is very true, it is unrealistic for us to travel to SV to just socialize. Speaking at conferences seems like a great way to build a reputation and get to meet people. If only I had something to speak about that would interest people... :) We do miss out a lot of startup action but there are still large startups in Europe, and I assume Singapore. I do think making connections via HN/Twitter etc can mitigate some of the issues caused by geography but not entirely. Talking to people in your industry (especially if your speciality is quite niche) goes a fairly long way. Perhaps someone in your niche went to your alma mater, or lived in Singapore - that is something in common that can spark a conversation.
- sharkfood 13y agoSounds great.... The dream we all long for; Silicon Valley dream. Though does anyone tell the stories where the little guy is invited out there by big influentials only to be baited into giving away their secret algorithm and then being stomped on? Beware innovators/entrepreneurs sharks abound, especially for the little guy. They'll sell you on your dreams only to get what they want from you then kick you and your dreams to the curb. Signed a lost and now destitute innovator/entrepreneur
- digitalengineer 13y agoWould you mind sharing some of your experiences a little bit more?
- thoughtcriminal 13y agoIf you built something special that people were willing to stab you in the back for, you can build something special again. Yes, there are predators and thieves everywhere. It's amazing how quickly an IP can be unwittingly pried out of a creators hands. Never underestimate that. And to anyone who will listen: never never never do a deal without having a lawyer go through it, no matter how smart you think you are or how straight-toward the deal seems.
- gbog 13y ago> Silicon Valley dream That's interesting, because most of the technical focus is on scalability, and this "Silicon Valley dream" is so very much not scalable. The "American dream" had more scalability potential, don't you think so?
- xyproto 13y agoPivoting is an integral part of the iterations of a lean startup and not "screwing up" as written in the clueless article.
- mcherm 13y agoI prefer to think that pivoting (as opposed to minor tweaks to business plan) is indeed, "screwing up", but that making mistakes is not a bad thing... as long as you can learn from it and move on to do better. Failing to screw up ever means you're not taking enough risks.
- soup10 13y agoWell connected individuals flipping over-valued companies to large corporations who have more capital than they know what to do with. Wake me up when VCs choose to fund companies that seek something other than validation and profit.
- jacquesm 13y agoI'm perfectly ok with VCs choosing to fund companies that seek profits.
- brazzy 13y agoSo when do you think tehy'll start doing that again?
- jacquesm 13y agoThere seems to be this terrible misunderstanding that 'VC' is a uniform unit the multiple of which is VCs. In fact, every VC is different, every VC has their own ideas of what companies are good to fund and which they'd rather pass on. So, right now there are VCs that will not fund companies that do not have a clear idea of how they're going to become profitable.
- Skibb 13y agowhich makes the sale of Shitagram slap in the face to all startups which actually have, oh I dunno, a business model lol
- logicallee 13y agoThe only terrible thing about the misunderstanding that VC's are uniform herd animals who all act the same way, have the saem ideas of what's good and what they'd rather pass on, is that it's true! Terrible but true. You will literally see vc look at the other VC and do exactly what they're doing. You can literally create your own VC market by making VC A think that VC B is interested, which is true, because VC B is interested in anything that VC A is interested in.
- SandB0x 13y agoYou may as well be reading about a rock band here. This story does not and will not apply to you. This is the one in a thousand/million fairy-tale of the frivolous app dreamed up in coffee shops, fuelled by rapid investment and sold for vast sums to a tech giant without so much as a whiff of a business model.
- Gepsens 13y agoYes, but I like fairy tales.
- Kiro 13y agoWhat's with the negativity? Are you telling inspiring musicians to stop trying as well?
- SandB0x 13y agoAspiring musicians appreciate the vast odds against them becoming the Next Big Thing. It takes an extremely young or naive person to believe that they will become a wild success off the back of some unpaid gigs or their YouTube channel. In fact, most musicians that I know are rightly insistent on being paid for their performances and are suspicious of promoters and agents who are eager for them to gain exposure by playing for free. Edit: Essentially there is a continuum of risk/reward between * Consulting or creating a small and stable business (or, say, playing as a session musician) * Buying lottery tickets. I just don't think that people are always aware of where they are on that scale and it doesn't seem right to give people false impressions of where they and their ideas stand. Yeah I do sound like a grumpy sod :)
- hagy 13y agoIf an aspiring musician were only motivated by the chance of making it big, I would definitely tell them to stop trying. Not because they’re pursuing an irrational goal, but because that’s not sufficient motivation to get through all the shit it takes to have a chance at making it big in music. Similarly with startups, if someone is only motivated by a huge exit then they won’t last through the years of low-success and failure that precede building a moderately successful business. Individual who succeed in these careers get some satisfaction out of the process and the small successes along the way (e.g. performing before ten people in a bar or having one potential customer get excited about your new product).
- Skibb 13y agoUgh this is linkbait and upvote-bait if I ever saw one. The whole tone of the article is so contrived and fake-mysterious that it's kind of digusting. Basically the whole thing can be tracked down to a rich privileged white kid doing what rich privileged kids do. NOTHING worth reading about here. And the shitty app could maybe start about thinking of getting some cash flow.
- nhangen 13y agoWhat does being white have to do with it?
- Skibb 13y agoOnly everything?
- pathy 13y agoYou appear to be very jealous of their success. This is Hacker News, we should celebrate the entrepreneurial spirit and look at the lessons that can be learned from success stories like this. If I could build Instagram and sell it for $1b I sure as hell would. Might not be saving the world but people appear enjoy using it so who cares. They did manage to sell a company for $1b, a feat which practically all of us never will achieve. That said, they probably should try to get some cash flow some time soon.
- gramsey 13y agoOh please. Spare us the jealousy insinuations, and stop perpetuating the myth that if entrepreneurs are actually worth anything and work hard, it is guaranteed that they will swiftly become inundated with success. Sometimes there are no "lessons that can be learned from success stories like this". Believe it or not, for every Instagram, there's a hundred startups with founders that are just as smart and try just as hard, but don't make the cut. Do the founders of Instagram deserve their success? Sure! Should we pat them on the back and "celebrate the entrepreneurial spirit"? Absolutely. But let's not fall over ourselves praying to the success gods while we forget to work on our own products. > If I could build Instagram and sell it for $1b I sure as hell would Bullshit. Maybe you could! All you need is hard work, the skills to get there, and yes, a good amount of luck. But let's not pretend you, or the founders of Instagram, are destined for success because you're special or you "knew" your ideas would kick off. Look up hindsight bias in the dictionary.
- maceo 13y ago"Rags to riches?" What a bunch of BS. Dude never experienced a moment of poverty in his life, and I doubt he would deny that.
- virtualwhys 13y agoWell, the article does mention that he was born in Brazil. Perhaps he was a glue sniffing Sao Paulo street kid who was adopted by a caring American WASP family that got him on the fast track to old/new money success. Seriously, boarding schools are choc full of uber achievers; the notion that wealthy kids are lazy is a myth (assuming trust-afarians are taken out of the equation).
- paprika 13y agoSo Instagram was sold for $750m and not $1bn. Majority of $300m went to investors. It's a great story to read (and maybe Ashton Kutcher can play Systrom as well, or at least Nicholas Hoult... Hunter Parish to play Krieger and it's time that Michael Cera debuts at Zuckerberg) but I can't help but think it would've been so much better for us, users, that Twitter bought them. I see it as a perfect social network - Vine for video sharing, Instagram for photo sharing, Twitter as a connecting platform with numerous additions - Radio, ... I just don't get Facebook anymore. Sure, a few years ago we were mad about it, spending days on it but I sense that hype is gone. Honestly I don't know why I'm still on it - stories from liked pages are the same as on my Twitter feed, I use Instagram to share my photos. Surely if you're serious about keeping in touch with people from the past, you already have their email or phone number.
- deleted 13y ago[deleted]
- oinksoft 13y agoThe country was practically founded on "get filthy rich quick," and the idea has never really gone out of vogue, for better or worse.
- marknutter 13y agoI disagree. Those are the stories you hear about, but the silent majority of successful businesses out there do it the old fashioned way by slowly growing a profitable, modest business into a larger and larger concern over time. Don't get wrapped up in all the hype.
- freehunter 13y agoIt's always been that way. You don't think the gold rush or the stock market crash happened because people were looking for stable, honest work, do you?
- brackin 13y agoQuite the opposite, America was founded on the latter. Only recently has the American dream been referred to as joining the stable middle class.
- alan_cx 13y agoThe reason people think the American Dream is as you state, is because the get rich quick people made it up to justify their exploitative wealth (I think slavery counts as exploitation), and need the common man to be educated and work hard for them, while spending all their earnings making the get rich quick people richer. In short, the American Dream is a fraud. Capitalism means a huge chunk of people literally have to be poor, other wise costs rise, inflation goes mental and capitalism fails. Dunno if any one has noticed, but, er recession? People wanted the trappings of the American Dream, they couldn't afford it so they borrowed, couldn't pay it back and the whole thing came crashing down, and the only people bailed out were... guess who..... yeah, the get rich quick paddlers of the American Dream. This is why we get boom and bust cycles. It happens when poor people trying to pretend to be rich begin to struggle to pay debt, and stop spending elsewhere. Its quite simple. Not to slag off the US, the whole of western capitalism did this. The only difference is that the US lie of the American Dream is engrained in to American culture, so much that Americans, well, none Americans too, really believe it to be true. Its not, and never will be, because it actually makes no sense. You cant be right with out poor people to make it happen. Most of us will struggle for literally nothing more than mere survival, then die. The real kick in the guts is that there is no known better system. Might be able to manage it better, but in the end, the masses will remain pretty poor, while the very few will be able to be filthy rich. I see no way out.
- pshin45 13y agoI much preferred Josh Williams' (former Gowalla CEO) recent blog post [1] on the Foursquare vs. Gowalla "Check-in Wars" and how it was Instagram who ironically emerged as the "victor". Much more informative and insightful than this Vanity Fair piece. [1] https://medium.com/work-education/6152adc41de9 https://medium.com/work-education/6152adc41de9
- loceng 13y agoMakes you realize in part, the clever name of Instagram, is just a name that now people associate with filters - though wasn't popular until its advent.
- cft 13y agoSilicon Valley has come a long way from 1966: from cutting edge material science http://youtu.be/z47Gv2cdFtA http://youtu.be/z47Gv2cdFtA to applying open source sepia filter... I am afraid that the logical end of this race to the bottom in terms of technology is the end of the Silicon Valley (perhaps something like Hollywood for "new media" replacing technology)
- stephenrcarter 13y agoConsumer-facing products are always going to garner the most press, but that doesn't mean more technically interesting things aren't going on as well. There are tons of core technology startups in Silicon Valley - we just don't talk about them on YCombinator very much. I find the software defined datacenter space really interesting. Check out Nutanix: A startup that aims to redefine enterprise datacenter architecture. Or how about the recent acquisition of Nicira (a software defined networking company) by VMware. Just look at Khosla Ventures product portfolio: http://www.khoslaventures.com/information-technology.html http://www.khoslaventures.com/information-technology.html. Food science startups, semiconductor, enterprise hardware/software, AND social media. The whole gamut.