You 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.
What Really Happened When Facebook Bought Instagram
31–40 of 148 posts
Re: What Really Happened When Facebook Bought Instagram
#32You 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.
Yes, but I like fairy tales.
Re: What Really Happened When Facebook Bought Instagram
#33Earlier quoted context omitted.
It's kind of your fault. That's a provocative statement, here's the justification: Instagram had "only" 18 employees. Wherever you are, will1000, hiring 18 employees of the caliber who built Instagram for 18 months would cost you $2M. Instagram was able to pay for them with equity, instesad of starting with $2M in the bank. The direct reason that this doesn't work outside silicon valley is that outside silicon valley…
> The direct reason that this doesn't work outside silicon valley is that outside silicon valley you, will1000, will not work for me for equity and no salary. That is only possible in Silicon Valley. Right, because only in Silicon Valley will people work for equity and no salary. They live off the air. Explain to me how talented coder 'x' (whoever, maybe will1000) will be able to live without any compensation whatsoe…
The portion you refer to is pocket change - it would not retain these employees outside Silicon Valley, where such caliber of employees are willing to give great weight to equity.
Read http://www.dailymail.co.uk/news/article-2127882/Meet-OTHER-n... and it becomes clear that the 18 employees were recruited mostly with equity.
Hiring the quality of talent that we're talking about, in will1000's market, just doesn't happen using the kind of equity (e.g. 10% pool) that instagram was using, without enough cash in the bank to pay a large base salary to each of those extremely talented people.
Outside silicon valley that's what you would need to do something like this: a whole ton of cash, or lower your standard of employee. Only in Silicon Valley can equity be used for this kind of bargaining power, to retain 18 people who are of such a quality that they are able 36-handedly to build a company in 18 months that is worth $1Billion.
As a simple example: I could never get you to work for me part-time for $0 and 30% equity in our company: except in silicon valley, where I could do so extremely easily, just by showing a product that is near completion.
It's your fault. You're the one who doesn't want the riches and results. You're the one who doesn't want to change the future, by working for next to free for it, and having just equity.
There's a reason a couple of kids in silicon valley can build multibillion dollar companies while on a ramen diet, and you can't.
you (and the market you're in) just doesn't want to.
Re: What Really Happened When Facebook Bought Instagram
#34Earlier quoted context omitted.
It's kind of your fault. That's a provocative statement, here's the justification: Instagram had "only" 18 employees. Wherever you are, will1000, hiring 18 employees of the caliber who built Instagram for 18 months would cost you $2M. Instagram was able to pay for them with equity, instesad of starting with $2M in the bank. The direct reason that this doesn't work outside silicon valley is that outside silicon valley…
Whoah! Instagram didn't pay salaries to any of their 18 employees?
The portion you refer to is pocket change.
Read http://www.dailymail.co.uk/news/article-2127882/Meet-OTHER-n.... and it becomes clear that the 18 employees were recruited mostly with equity. Hiring the quality of talent that we're talking about, in will1000's market, just doesn't happen with the kind of equity (e.g. 10% pool) that instagram was using - outside of silicon valley that is.
Re: What Really Happened When Facebook Bought Instagram
#35Earlier quoted context omitted.
> The direct reason that this doesn't work outside silicon valley is that outside silicon valley you, will1000, will not work for me for equity and no salary. That is only possible in Silicon Valley. Right, because only in Silicon Valley will people work for equity and no salary. They live off the air. Explain to me how talented coder 'x' (whoever, maybe will1000) will be able to live without any compensation whatsoe…
The portion you refer to is pocket change - it would not retain these employees outside Silicon Valley, where such caliber of employees are willing to give great weight to equity. Read http://www.dailymail.co.uk/news/article-2127882/Meet-OTHER-n... and it becomes clear that the 18 employees were recruited mostly with equity. Hiring the quality of talent that we're talking about, in will1000's market, just doesn't hap…
> The portion you refer to is pocket change.
You're currently running a company with in excess of 18 talented engineers without a viable income stream?
And your payroll is 'pocket change'?
> Hiring the quality of talent that we're talking about, in will1000's market, just doesn't happen with the kind of equity (e.g. 10% pool) that instagram was using - outside of silicon valley that is.
Of course it does.
You make some outrageous statement, then fail to back it up, next you make a new outrageous statement which is even further from the truth.
Re: What Really Happened When Facebook Bought Instagram
#36Earlier quoted context omitted.
As someone in the US and in California, but !in the bay area and !in rapport with the likes of Marc Andreessen, Jack Dorsey and Mark Zuckerberg, I too wonder if Instagram-like success would be possible for a startup that is not in that position. And if it isn't possible, perhaps the rest of us should think twice about aspiring to that specific type of success.
It's kind of your fault. That's a provocative statement, here's the justification: Instagram had "only" 18 employees. Wherever you are, will1000, hiring 18 employees of the caliber who built Instagram for 18 months would cost you $2M. Instagram was able to pay for them with equity, instesad of starting with $2M in the bank. The direct reason that this doesn't work outside silicon valley is that outside silicon valley…
That was part of my point that Instagram would be less likely to work out outside of SV. This article helps us on the outside looking in understand how many things you have to have going for you other than just talent and a good idea to achieve the level of success Instagram has.
Re: What Really Happened When Facebook Bought Instagram
#37Earlier quoted context omitted.
The can-do attitude is something to be envied but the dynamism and opportunities available in the Valley and generally in the USA make a big difference. If your big idea doesn't pan out then the (almost) worst case scenario is that you simply go and work for somebody else. I don't think other country's economies are nearly as developed in that respect. In many cases developers are hired on the basis of cost and anyth…
Don't forget the other side of the coin: that "can do attitude" and that environment can also, if you buy into it too far and don't get lucky, have you broke and homeless. It's partially a gamble, and magazines write articles only about the winners.
I agree with that, but that´s true anywhere in the world. In Spain if your company fails you may be personally liable of the debt. Recently a bank removed 3000€ from my grandmother account because of a debt dated from 1993 of my deceased grandfather´s company. My grandmother is 97 years old, and the funniest part is that debt was settled long ago. Also if you fail nobody is going to trust in you any more, you are done.
I know that SV is not the golden city that this articles paint, but it is way ahead when we speak of entrepreneurship and startups.
Re: What Really Happened When Facebook Bought Instagram
#38Ugh 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.
Re: What Really Happened When Facebook Bought Instagram
#39What 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…
> 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.
Indeed, writing is vapid at best.
Re: What Really Happened When Facebook Bought Instagram
#40Earlier quoted context omitted.
So when do you think tehy'll start doing that again?
There 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.
which makes the sale of Shitagram slap in the face to all startups which actually have, oh I dunno, a business model lol