Facebook bought the start-up to a billion. Today it has more users bird
Milan , March 3, 2015 – 11:31
A billion dollars for a startup that did not produce a dollar of profit. When, in 2012, the CEO of Facebook Mark Zuckerberg had formed an agreement to acquire the application of photography (with integrated social) Instagram many had wondered if they really worth all that money. The company founded by Kevin Systrom (now 31 year old) was two years old, 25 million monthly active users and no plan for the future than to exploit the filters to improve retro photographs of users. No business model, especially. But this had not worried Zuckerberg: after all even Facebook – founded in 2004 and ten years later the social giant with its nearly half billion users – was born with no idea how to make money.
Forecast
Today Facebook instead earns, and a lot. The last quarter of last year marked a profit of $ 701 million, with revenues of 3.85 billion. Figures that, for analysts, Instagram could overcome in the next five years according to the calculations of the analyst firm Cowen and Co. 2020 social photo close the budget with revenues of $ 5.8 billion.
In short, according to these numbers the real goose that lays the golden eggs of Zuckerberg would be precisely the photography software developed by Systrom. And long overshadowed by the most recent acquisitions, such as the messaging application WhatsApp Free or startup of virtual reality Oculus Rift. The first has made headlines for numbers: Zuckerberg bought it for $ 21 billion. The second for the innovative potential: I wonder how the CEO of Facebook intends to use it. Meanwhile, while shopping startup continued (from the company’s production of drones Ascenta to that which builds systems to support voice Wit.ai), Instagram grind numbers. Users first: from one million in 2010 went to the ten of 2011, touching portion 25 in 2012, then 150 in 2013 and more than 300 last year. Assessment, in second place: now the application, according to estimates by Citigroup, would reach the value of $ 33 billion. Revenue, to finish: forecasts indicate that already this year Cowen Instagram could reach a turnover of $ 700 million.
On the podium
All numbers brought the application to overcome other companies implicated as the best of the tech scene. And ‘the case of Twitter, the social 140 characters that not only is always at a loss but has not yet managed to reach the milestone of 300 million users (and its capitalization comes to just over 20 billion). Or WhatsApp, which last year closed the year with a turnover of 10 million dollars. Or even Snapchat, the messaging application that he refused the offer of acquisition of Facebook and is now worth $ 19 billion.
But above all, according to Citigroup, the success of Instagram is just beginning. In a statement released in December, the analyst firm has explained that the application “has recently started to monetize and its contribution on Facebook is for now at least.” The first attempts to introduce the advertising date of the end of 2013 when in fact, no rush and a bit ‘on the sly, the application has inaugurated the content service promoted, namely advertising. The caution was dutiful: many users had protested against the contents of this kind.
After a little more than a year the use of this tool has now cleared customs. It found good results, so much so that analysts Cowen have released a statement in which you say “convinced that the $ 700 million in revenue in 2015 will come to 5.8 billion by 2020.” The success of the application, that after introducing the hashtag to thematise (and find) more easily photographs has also recently opened a mini video from 15 seconds, has made it popular among users more disparate. After celebrities and brand, now it’s up to the great experiment tested the platform. The BBC , for example, the uses to post news pills in the form of short video. The New York Times, however, has just invested in the creation of a dozen thematic account and vertical. The purpose is not to increase the traffic on the websites of the newspapers (Instagram does not support external links) but cure the brand on a new “pitch”: as stated Alexandra MacCallum, head of digital strategies of the NYTimes , “it is an attempt to build awareness and loyalty to the head through a narrative that plays on the images.”
March 3, 2015 | 11:31
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