Wondering why did Mark Zuckerberg buy Instagram? You’re not the only one. While finding Facebook its Co-Founder Mark Zuckerberg might not have fathomed about how much a colossal hit it would turn out to be. But Facebook managed to be a huge hit and was dominating the social networking market worldwide. The most logical solution to maintain that edge would be to avoid completion or owning it together.
The US House antitrust subcommittee had made the email exchanges between Facebook CEO Mark Zuckerberg and David Ebersman (former chief financial officer) public. The company and Zuckerberg, in particular, wanted to buy Instagram to avoid future competition.
Rep Jerry Nadler* had drilled Zuckerberg about the Instagram acquisition during the testimonies from the GiantTech CEOs, including Amazon’s Jeff Bezos, Sundar Pichai of Google & Tim Cook of Apple. The emails had revealed that Zuckerberg’s motive to buy Instagram was because it was becoming a threat to Facebook, as it could siphon the business away. Rather than compete with it, Facebook bought it, simple yet quite an effective solution.
How much did Facebook buy Instagram for?
Facebook had bought Instagram for $1 billion in 2012, though compared to how Instagram is performing right now it would seem undervalued, it was a shocking sum at that time for a company with manpower of just 13 employees.
Why did Mark Zuckerberg buy Instagram, and How did the purchase turn out for Facebook?
You could say it might have been the best step Facebook had ever taken or ever will. Instagram as of today has over 1 billion users, and it contributes over $20 billion towards Facebook’s annual revenue. It probably seems like a given that Instagram would reach the scale that it has today. But during that time, it was far, far from obvious.
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* An American lawyer & politician serving for the U.S. Representative of New York’s 10th congressional district since 2013.