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What Really Happened When Facebook Bought Instagram

vanityfair.com

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Re: What Really Happened When Facebook Bought Instagram

#131

Post by thecage411 »

marknutter wrote: post #107
Goronmon wrote: post #105

Earlier quoted context omitted.

Well, "Millionaire Next Door" uses examples of millionaires to provide some form of guidance (at least on some level) to non-millionaires on what it takes to actually become wealthy. Though, I haven't read it, I would assume that "Fooled by Randomness" would explain the wealth of the individuals from "Millionare" as more to do with luck than anything else, and that it's not repeatable. And that fulfilling the "Americ…

Wow. No, I'm sorry, but TMND explains very clearly, backed by solid statistics, how people become rich, and it doesn't have anything to do with luck. In fact, the process of becoming a millionnaire is quite boring and unglamorous; invest prudently, cut expenses, don't buy new cars, have a modest mortgage, etc. Very few of the millionnaires interviewed in the book "got rich quick". The vast majority of millionnaires i…

It's been awhile since I read Fooled by Randomness but I think Taleb's point was that TMND only looks at those who became rich, it doesn't look at those who didn't get rich following the same strategy.

I haven't read TMND so I can't say if that's true, but your post doesn't refute his point.

Re: What Really Happened When Facebook Bought Instagram

#132

Post by mchusma »

logicallee wrote: post #98
jacquesm wrote: post #81

Earlier quoted context omitted.

Some questions for you: Do you run your own company? Do you have employees? Co-founders? Have you ever received funding from a VC? Have you ever solicited funding? Were you accepted? Rejected?

all of the above (yes to all seven question marks) except for number four receiving funding (from a vc), as in check clears, no that hasn't happened yet. going through this process now - and I can tell you, if I fucked up with one VC I would fuck up with them all. everyone talks. On the flip side, when you're hot everyone wants you, you don't have enough equity to sell to everyone!

I think you overestimate how efficient the VC market is. You can fuck up a lot of pitches and still close. In fact, most people hear No much more than Yes. Very rare to just walk in and get an offer without knocking on doors.

Re: What Really Happened When Facebook Bought Instagram

#133

Post by SCAQTony »

logicallee wrote: post #67
SandB0x wrote: post #31

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.

I see. Let's say I see a big incumbent who's UNIQUE selling point is 'we have everyone's private photos. people have to come to us if they want to see their friend's photos.' I start threatening them. They pay and buy us. I get rich. The incumbent gets to keep everyone's photos. At what point in the above do we not have a business model? Oh, you mean it can't possibly WORK! Except that it just did. Well, I'm sorry, b…

So, the unique selling point is that they own "everybody's memories" ("Blade Runner" reference)

Remember that failed Terms of Service agreement as mentioned in the article; the one that allowed Instagram to own everyone's photos? (Memories.)

It went like this:

"...Some or all of the Service may be supported by advertising revenue. To help us deliver interesting paid or sponsored content or promotions, you agree that a business or other entity may pay us to display your username, likeness, photos (along with any associated metadata), and/or actions you take, in connection with paid or sponsored content or promotions, without any compensation to you...."

Do you realize the "stock-photo" potential Facebook would have had by selling limited rights to say a photo of Johnny Depp smoking a Gauloise cigarette, or Gwen Stefani in high school drinking a diet coke?

Maybe that was the "instagram" business model as seen by Facebook?

Re: What Really Happened When Facebook Bought Instagram

#134

Post by jimray »

ritchiea wrote: post #128
EGreg wrote: post #7

I 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?

Ha. I would say a better question is, how does someone who grows up poor do this? And/or someone with parents who do not give them access to excellent schooling. And/or currently feels excluded from the industry despite being talented.

This was exactly my big gripe with the story, particularly Swisher's insistence on writing it as "rags to riches" (even using that very well worn cliche verbatim). The fact is, Systrom, like Zuckerberg, was practically guaranteed success in life, starting with his $30k/year prep school. This isn't rags to riches, it's well-off to obscenely rich, or if you prefer, how to go from the 1% to the .1%.

Not that it isn't a story, it sure ain't Horatio Alger, though.

Re: What Really Happened When Facebook Bought Instagram

#135

Post by ioncereadknuth »

SandB0x wrote: post #31

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.

Agreed.

Lets look at the investor list: Seed was Baseline Ventures and Andreessen Horowitz. A-round was Adam D'Angelo, Jack Dorsey, Chris Sacca, Baseline Ventures, and Benchmark Capital. Then there was Joshua Kushner, and John Lilly.

Wait, who?

Adam D'Angelo - Quora founder. More importantly, "He was chief technology officer of Facebook, and also served as its vice president of engineering" . Top 25 TopCoder participant, respect.

Jack Dorsey - Twitter and Square founder

Joshua Kushner - son of the real estate mogul Charles B. Kushner and brother of Jared Kushner, owner of The New York Observer

We already know one of the founders went to school with Zuck. Cant find citations now, but it was in an online interview.

So it sure helps to be school buddies with Zuck, have ex-Facebook CTO and Zuck friends as investor, and new media (twitter) and old media (kushner famliy) owners as well.

Re: What Really Happened When Facebook Bought Instagram

#136

Post by stephenrcarter »

cft wrote: post #111

Silicon Valley has come a long way from 1966: from cutting edge material science 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)

Consumer-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. Food science startups, semiconductor, enterprise hardware/software, AND social media. The whole gamut.

Re: What Really Happened When Facebook Bought Instagram

#137

Post by sopooneo »

nickpinkston wrote: post #118
rz2k wrote: post #114

Earlier quoted context omitted.

Which also happens to have pretty good articles every now and then.

Hear Hear - Christopher Hitchens was its editor, so it can't be that bad.

Which frankly, baffles me. I see it at the supermarket, right? Next to the other fashion magazines and it also looks like a fashion magazine?

So I'm not contesting the truth that it sometimes has serious heavyweights writing for it, I'm just baffled by that fact. It's like if you found out Gore Vidal had been writing for Good Housekeeping.

Re: What Really Happened When Facebook Bought Instagram

#138

Post by nickpinkston »

sopooneo wrote: post #137
nickpinkston wrote: post #118

Earlier quoted context omitted.

Hear Hear - Christopher Hitchens was its editor, so it can't be that bad.

Which frankly, baffles me. I see it at the supermarket, right? Next to the other fashion magazines and it also looks like a fashion magazine? So I'm not contesting the truth that it sometimes has serious heavyweights writing for it, I'm just baffled by that fact. It's like if you found out Gore Vidal had been writing for Good Housekeeping.

Yea, you and me both are baffled! I almost wonder if he treated it as a sinecure.

Re: What Really Happened When Facebook Bought Instagram

#139

Post by Skibb »

kmfrk wrote: post #66
Skibb wrote: post #39

Earlier quoted context omitted.

Indeed, writing is vapid at best.

Vapid 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.

Well it IS Vanity Fair after all.

Re: What Really Happened When Facebook Bought Instagram

#140

Post by Skibb »

toomuchtodo wrote: post #115
logicallee wrote: post #67

Earlier quoted context omitted.

I see. Let's say I see a big incumbent who's UNIQUE selling point is 'we have everyone's private photos. people have to come to us if they want to see their friend's photos.' I start threatening them. They pay and buy us. I get rich. The incumbent gets to keep everyone's photos. At what point in the above do we not have a business model? Oh, you mean it can't possibly WORK! Except that it just did. Well, I'm sorry, b…

A business model insinuates a viable ongoing business, where you have customers, and profit. You know, an "ongoing concern". Being bought because you're shiny? Not a business model. To say Instagram has a business model is to insult every hacker/doer/entrepreneur who is actually trying to build a real business.

That is so true and I already got -2 points for trying to same the same thing in another comment.
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