Deborah Perry Piscione - Creating Value First

Creating Value before Making Money

by Deborah Perry Piscione

In 2010, Stanford University graduate Kevin Systrom was working on a multifeatured HTML5 (the markup language that structures content for the web) check-in project on mobile photography, originally called Burbn. He began to build the prototype without any branding elements or design at all, just concentrating on its functionality and usability. After meeting a VC from Baseline Ventures and another from Andreesen Horowitz at a party, Systrom pitched his idea and within two weeks, he had raised a total $500,000 from both.

Systrom recruited a Stanford friend, Mike Krieger, to help him develop the company. Together, they decided to focus exclusively on mobile photos. After developing a prototype of Burbn, they felt the app was too cluttered and overrun with features.  One area where the app excelled in was its distinctive feature that confined photos to a square shape. So, they renamed the resulting program Instagram, to conjure the idea of an “instant telegram.”

Deborah Perry Piscione - InstagramIn December 2010, Instragram announced full photo support and sharing on Foursquare, a location based social networking site for mobile phones, and quickly grew to a million registered users. After the impressive launch of Instagram, Kevin Systrom called on a fellow Stanford University Sigma Nu brother, Adam D’Angelo, former chief technology officer at Facebook. D’Angelo spent 30 minutes on the phone walking Systrom through all the basic things Instagram needed to do in order to get technically backed up. He made it clear that Systrom should spend time talking and getting to know the people around him, because one day, those people could be the ones to “press money into his palm”.

In February 2011, Instagram raised $7 million in Series A round, the name typically given to a statup’s first significant round of venture capital funding, from a variety of investors, including Benchmark Capital and serial entrepreneur Jack Dorsey. Instagram grew to 5 million users by June 2011, over 10 million by September, and in April 2012 announced its explosive growth to over 30 million users. All the while Instagram’s extraordinary success grew without any revenue. In the fall of 2011, new reports stated that the company was seeking a $20 million valuation as it planned to go after another round of funding. In April 2012, Sequoia Capital was said to be leading a $50 million funding round for the company, valuing Instagram at $500 million. Then, within that same month, Facebook announced their agreement to acquire Instagram for $1 billion in cash and stock, with plans to keep the company independently managed.

 

Deborah Perry Piscione has written four bestselling books, is an authority on business innovation and is a popular keynote speaker for important business events.

11 thoughts on "Creating Value before Making Money"

We absolutely love your blog and find most of your post’s to be just what I’m looking
for. Would you offer guest writers to write content for yourself?
I wouldn’t mind producing a post or elaborating on many of
the subjects you write regarding here. Again, awesome web log!

I absolutely love your blog.. Excellent colors & theme.
Did you develop this site yourself? Please reply back as I�m planning
to create my own personal blog andd would like to know where you got thgis from or just what the theme is named.
Cheers!

I was more than happy to uncover this great site. I need to to thank you for your time due to this fantastic read!! I definitely enjoyed every bit of it and I have you bookmarked to see new information on your blog.

mabosvip.com says:

I’m extremely pleased to find this web site. I need to to thank you for your time due to this fantastic read!!
I definitely enjoyed every bit of it and i also have you book-marked to look
at new information in your web site.

Great blog here! Also your site loads up very fast!
What web host are you using? Can I get your
affiliate link to your host? I wish my site loaded up as quickly
as yours lol

betberry.com says:

Hey! Would you mind if I share your blog with my myspace group?
There’s a lot of people that I think would really enjoy
your content. Please let me know. Many thanks

here says:

Useful info. Lucky me I discovered your website unintentionally, and I am
shocked why this coincidence didn’t took place in advance!
I bookmarked it.

bukauser.com says:

Greetings! Very helpful advice in this particular post!
It’s the little changes that will make the largest changes.

Thanks a lot for sharing!

bukauser.com says:

Just desire to say your article is as astounding. The clearness
in your post is simply cool and i could assume you
are an expert on this subject. Fine with your permission let
me to grab your RSS feed to keep updated with forthcoming post.
Thanks a million and please keep up the gratifying work.

Very good article! We will be linking to this particularly great content on our website.
Keep up the good writing.

Leave a Reply

Your email address will not be published. Required fields are marked *