How Instagram Could Have Cut a Better Deal
dealbook.nytimes.com
How Instagram Could Have Cut a Better Deal
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Re: How Instagram Could Have Cut a Better Deal
#2TL;DR
300m + 700m in Facebook shares in April (much less today) was careless and very very very very veryvery shitty deal, for a service with no revenue, albeit hot. So learn from this.
Re: How Instagram Could Have Cut a Better Deal
#3This was a well known fact from the get go. TechCrunch on May 17th:
http://techcrunch.com/2012/05/17/facebooks-38-share-price-ma...
> When Facebook agreed to buy Instagram, it said it would pay with $300 million in cash and 22,999,412 shares of stock. That stock is now worth nearly $874 million, creating a $1.17 billion price tag.
Re: How Instagram Could Have Cut a Better Deal
#4TL;DR 300m + 700m in Facebook shares in April (much less today) was careless and very very very very veryvery shitty deal, for a service with no revenue, albeit hot. So learn from this.
Instagram will go down as being a shitty deal for both sides. An arranged marriage, as it were.
Re: How Instagram Could Have Cut a Better Deal
#5Instagram "no longer" a $1 billion sale would perhaps be more accurate. Still quite impressive for a zero-revenue service.
Re: How Instagram Could Have Cut a Better Deal
#6TL;DR 300m + 700m in Facebook shares in April (much less today) was careless and very very very very veryvery shitty deal, for a service with no revenue, albeit hot. So learn from this.
Instagram will go down as being a shitty deal for both sides. An arranged marriage, as it were.
Why do you think this will end up being a shitty deal for Instagram?
Re: How Instagram Could Have Cut a Better Deal
#7I've done this math in my head too much now in the last couple of weeks. Not sure why I care that much.
Re: How Instagram Could Have Cut a Better Deal
#8Re: How Instagram Could Have Cut a Better Deal
#9Re: How Instagram Could Have Cut a Better Deal
#10This article was definitely interesting reading for someone that knows nothing about acquisitions, not so much for the particular fate of Instagram but for the details of how stock/cash deals can work and the stock collar possibilities...