Connor Brooke
Well, Facebook just made a big acquisition, which is news because: (a) it’s Facebook, (b) it’s big and (c) Facebook hasn’t really done this before. So, let the games begin! Shortly before the Facebook IPO, the white-hot social media company has shown that it can do a deal, and it picked up what could have turned into a major rival in the photo space.
Here are the details:
1. Sale price: Facebook acquired Instagram for $1 bn.
2. The goods: Instagram is a mobile photo-sharing platform with more than 30 mn users on iPhone. It just launched on Android last week, where it added a million users in the first day.
3. The people: 13 employees and nine investors get rich off the acquisition, which came in the form of cash and stock. Ostensibly, they will benefit again in a month and a half or so, with the Facebook IPO.
4. Serious returns: interestingly, Instagram closed a $50 mn venture capital round on Thursday, according to Business Insider, led by Sequoia Capital. The implied valuation was $500 mn. Apparently, Facebook CEO Mark Zuckerberg ‘flipped’ when he learned of this and acquired Instagram, with the deal made ‘in the last 24 hours.’ Nobody saw this coming: not Instagram, not Sequoia Capital … and not Facebook.
Here’s the original post on the acquisition, as well as the one about the venture capital rumors.
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Source: Business Insider
Photo: @lauriedeprete via Instagram
This article was written for Business 2 Community by Connor Brooke.
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