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Instagram? More Like Insta-Cash

 

By Matt Koppelman, Digital Account Executive, MSLGROUP

 

Just recently moving out of Twitter’s former digs and into its own space in San Francisco’s South Park district, many thought photo-sharing and filter app Instagram would be taking their freshly minted million user addition, courtesy of their new Android app, and plunge neck-deep into another influx of venture capital.

 

 

 

Instead, Facebook, with potential IPO cash burning a hole in its pocket, decided to double-up the previous valuation and acquire Instagram for about $1 billion in cash and stock. The announcement took place (where else?) on the Facebook feed of CEO Mark Zuckerberg earlier this afternoon.

 


The feed, which has more than 12 million Facebook subscribers, focused on assuring the masses the Instagram brand would remain independent of the social networking juggernaut, keeping the app’s cross-platform functionality intact.
Facebook has made several acquisitions since 2005, though the majority of its M&A history has been with smaller companies – below $100 million.

 

The Instagram community, along with half-sibling Hipstamatic and distant-cousins Pinterest and Tumblr, have seen their influence rise with content marketers as brands move at a snail’s pace towards visual-heavy mediums for consumer engagement purposes.


Even prior to the Facebook acquisition, the magical twin-terms of “monetization” and “ROI” surrounded Instagram, adding fuel to the fire between social marketers specializing in the content creation/user engagement and the data-focused offspring of paid display advertising.

Perhaps it begs the question, but can any community balance the central dogmas of these two camps? While the transaction is expected to close later this quarter, app developers, community managers and brand marketers will be monitoring for changes in Instagram’s performance closely. Between the Instagram team staying on to continue app development and a working, if rather plain, integration into Facebook’s open-graph and Timeline updates, will be subject to increased scrutiny – mostly based on consumer feedback.

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This post originally appeared on MSLWorldwide. Follow Matt Koppelman on Twitter: @mattkoppelman

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