Facebook Acquires Instagram For $1 Billion

Instagram

Facebook has just announced that it is buying Instagram, the hugely popular photo-sharing service.

According to reports, Facebook may have bought Instagram for a whopping $1 billion.

Facebook founder and CEO Mark Zuckerberg announced the acquisition in a blog post:

For years, we’ve focused on building the best experience for sharing photos with your friends and family. Now, we’ll be able to work even more closely with the Instagram team to also offer the best experiences for sharing beautiful mobile photos with people based on your interests.

We believe these are different experiences that complement each other. But in order to do this well, we need to be mindful about keeping and building on Instagram’s strengths and features rather than just trying to integrate everything into Facebook.

That’s why we’re committed to building and growing Instagram independently. Millions of people around the world love the Instagram app and the brand associated with it, and our goal is to help spread this app and brand to even more people.

We think the fact that Instagram is connected to other services beyond Facebook is an important part of the experience. We plan on keeping features like the ability to post to other social networks, the ability to not share your Instagrams on Facebook if you want, and the ability to have followers and follow people separately from your friends on Facebook.

These and many other features are important parts of the Instagram experience and we understand that. We will try to learn from Instagram’s experience to build similar features into our other products. At the same time, we will try to help Instagram continue to grow by using Facebook’s strong engineering team and infrastructure.

Instagram (App Store link) was voted the iPhone app of the year in 2011 by Apple and recently crossed the 30-million iPhone users milestone and had also released an Android app last week, which was downloaded more than a million times in 12 hours.

The San Francisco-based company has only 13 employees and raised $7 million just over a year ago, when it only had 1.75 million registered users. So it is an amazing deal for its founders and employees.

  • OGT

    Wow…!

  • Wiilt

    Stupid decision, if you ask me.

    • Jeahman

      You clearly don’t know the stats of this app. It has 30+ million users. And since facebook is the leading social network, AND GOT CASH, why not outdo the competition. As you know instagram is not quite there. But they will. Basically, a great decision.

      • eckon

        I agree..

      • j meister

        30+ million users 99.9% of which are already Facebook users. So the acquisition was about $33,000 per new user. Sounds solid to me. Seriously though – it’s all funny money at this point. The Instagram guys are just the latest sellouts. Hopefully they’ll leave and do something innovative with their money.

      • Joe

        And it raised $50 million based on a $500 million valuation just days before this announcement. They make nothing and they lose money and the value doubles in a few days? It’s just history repeating itself.

  • Symphony

    13 employees?? WOW. I hate instagram but i can respect the business

    • Mediascapenorth

      17 employees divide 1 billion wow ( not equally) but still, time to buy an island

  • Poor1

    Aaaand the internet bubble is building up (again!). Facebook is slowly turning into a hedge fund but not like a conventional one. Buy out the techies with high number of users, drain all the knowledge and best whizzkids out of these techies, force a synergy so all the best features are added to facebooks products and than slowly dump these drained techies! Good for you marky mark zuckerberg!

  • http://www.motorbeam.com/ faisal

    Insane stuff, what nice valuation.