Can anyone hear the flush sound?
Upvotes for you, sir!
Facebook acquires Instagram
321–330 of 394 posts
Re: Facebook acquires Instagram
#322$1 billion for a 13-person team? Is this the highest per-employee price tag?
I thought that was the real story here.
Re: Facebook acquires Instagram
#323Can someone explain how this isn't insider trading? Day before deal: - Instagram closed a $50 million Series B round from Sequoia, Josh Kushner’s Thrive Capital, Greylock and Benchmark at a $500 million valuation. Day of deal: - Company gets purchased for 1 billion. - All investors instantly double investment.
I am willing to bet the $50M raised is all the cash the founders pocketed, FB gave stocks to investors and the team.
Re: Facebook acquires Instagram
#324$1 billion for something literally no one uses.
Web bubble 2.0 can't burst soon enough.
Re: Facebook acquires Instagram
#325Earlier quoted context omitted.
Okay, you go ahead and bet on the companies that will pay you a 10x return in ten years and I'll take the 2x return in two months. Will Instagram even exist in 10 years? Who knows? I wouldn't bet on it. BTW, you're absolutely right. The 2x return extrapolates to a return of trillions of dollars over ten years, so there really is no contest at all. It doesn't matter if you run a hedge fund, a VC fund, or a trust fund.…
> It doesn't matter if you run a hedge fund, a VC fund, or a trust fund. A 2x return is a 2x return, and anybody would take it any day. Anybody who wouldn't has no business working in finance. Just because you assign a ten-year time frame to your portfolio does not diminish the return on that investment, so the return on your $50mm is 2x, not 1.1x. This is your key misunderstanding. When the fund starts, you lock up…
I fully understand that. What I am explaining to you is that the idea of a VC fund is to create a return by investing money in a portfolio of companies which overall, should create a positive return. There is absolutely no way of knowing going in what the fund will return. If I figure that out of ten investments one will create a positive return great enough to pay for nine others, that does not mean that I am hoping or expecting that each of the ten will return me 10x. Keep in mind that those nine losers are completely independent of each other. If five win and five lose, all the better. If five win and three break even and two lose, that's even better.
If I invest $100 into 10 different stocks, and I figure that nine of the ten are going to be losses, then I hope that one of the ten will return me at least $1000, or 10x my original investment. That's very different than saying that any of the ten that returns me less than 10x is a disappointment. On the contrary, if one happens to return me 10x over the lifetime of my portfolio and another returns me 2x, then I am even better off than I anticipated.
Re: Facebook acquires Instagram
#326Earlier quoted context omitted.
Facebook currently has very limited editing for their pictures. By acquiring a well-known and talented company, Facebook can roll this into their current offerings. I would be very skeptical that this was a user-driven move. I can't imagine a large percentage of Instagram users who are not also Facebook users, even if people posted a lot of Instagrams to Twitter.
I don't think Facebook would spend $1B for image editing. Image editing has well known and documented solutions.
I think they bought a younger demographic. When I was young I didn't want to hang out with my parents and their friends.
Re: Facebook acquires Instagram
#327Earlier quoted context omitted.
and keeping Instagram away from Google. it's a good move.
But back to the original proposition, is this indicative of a bubble when you drop 1 Billion, or >1% of your estimated market cap on a preventive/defensive measure?
you ever play chess? A pawn is 2.6% of your game's value.
Re: Facebook acquires Instagram
#328A thought experiment : What if Facebook is making their own phone.. And the phone's camera basically is instagram?
Re: Facebook acquires Instagram
#329Why is this news? Who cares? seriously, this matters less than cankles on an elephant. Grow up people.
Re: Facebook acquires Instagram
#330This is very reminiscent of Google/YouTube circa 2006. When Google bought YT it was a small team of people and a pretty nascent product that people really loved, and the usage numbers were out of control. They left the product mostly untouched and let it grow on its own. Though there was major criticism at the time, it is one of the best tech acquisitions of the past decade.
This feels a lot more like the 1999 "eyeballs" landgrab. There's no unique technology behind Instagram.
Being popular != being valuable.