Instagram’s perseverance paid off

Entrepreneur News:

The news that is creating flutter in the Silicon Valley is that the Social Networking Giant Facebook announcement to acquire a photo-sharing app Instagram for a whopping price if $1 billion. Predominantly it raised the eyebrows of many as Instagram had no revenue model and had just 13 employees on board. However, than what makes Facebook drool over this start up is worth reasoning.

Photos are critically important for Facebook, which has been slow to innovate in the fast-growing mobile arena in the important consumer space. on the other hand San Francisco-based  Instagram had 30 million Apple iPhone users before it came to Google’s Android, where it got more than a million new users in just 12 hours.

The acquisition kindled the hope of many in the industry, with questions arising that has the hype bubble again emerged. But the fact is that perseverance pays off and that is what Instagram did, many critics wrote the company off with its iOS-only app. However, the company stuck to its platform and ensured that it sealed competitors with winning advantage. This paid off for its tremendous response from the consumers and in turn paved way for reigning supreme in the segment.

Some venture capitalists think Instagram was a one-off. “It’s certainly an outlier from a valuation standpoint,” said Matt Murphy, a partner at Kleiner Perkins Caufield & Byers who manages its $200-million iFund. “There was a big strategic concern or threat there” for Facebook, he said.

This only goes on to prove that this time it is not a hype bubble but technology pays off on the long run. This has a great lesson to start up across the globe and in particular to India. Watch out this space for the second part: what Indian Start ups gain from Facebook-Instagram deal!! Way2World certainly believes and hopes that this is just the tip of the iceberg and more Enterprises are to make big this financial year.