Instagram, Facebook’s most brilliant acquisition
In April 2012, Facebook CEO Mark Zuckerberg did the unthinkable. With the company about to begin its IPO roadshow, Zuckerberg made a surprise acquisition of a 2-year old photo sharing app called Instagram.
What’s more, Zuckerberg shelled out $1 billion for an app that had 13 employees, zero revenue, and which most of the investors that would attend its IPO roadshow had probably never heard of.
The deal caused immediate concern. Some considered the deal a sign of Zuckerberg’s impulsive nature and questioned whether the then 27-year old founder was ready to immediate, lead a publicly-held corporation.
It might have been one of the smartest things Zuckerberg ever did. Instagram was the star of the show during Facebook’s fourth-quarter earnings report. Instagram’s contribution to Facebook’s top line is still just getting started.